Tuesday, March 25, 2008

What is an Investment Bank?

Investment Banks have been widely discussed recently. Bear Stearns is one, as is Lehman Brothers. It begs the question, "what is an investment bank?"

Investment Banks don't offer services to normal retail customers like you or me nor do they have branches on the high street.

Basically they operate in 2 ways,
  1. Helping companies and governments raise money by issuing and selling shares in the organisation or debt such as corporate bonds.
  2. They also provide advice on mergers between companies & acquisitions

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