Investment bank

Investment banks assist public and private corporations in raising funds in the capital markets (both equity and debt), as well as in providing strategic advisory services for mergers, acquisitions and other types of financial transactions. Investment banks differ from commercial banks which take deposits and make commercial and retail loans. In recent years, however, the lines between the two types of structures have blurred, especially as commercial banks have offered more investment banking services. In the US, the Glass-Steagall Act, initially created in the wake of the 1929 market crash, prohibited banks from both accepting deposits and underwriting securities; Glass-Steagall was repealed by the Gramm-Leach-Bliley Act in 1999. Investment banks may also differ from brokerages, which in general assist in the purchase and sale of stocks, bonds, and mutual funds. In some cases, brokerages and investment banks are integrated into single firms.

Related Topics:
Corporation - Capital market - Equity - Debt - Mergers - Acquisitions - Commercial bank - Glass-Steagall Act - 1929 market crash - Gramm-Leach-Bliley Act - 1999 - Brokerage

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