Lecture 10 - Investment Banking Flashcards
What are some products on the primary side of Investment Banking
M&A, DCM, ECM, restructuring
What are some products on the secondary market
Research, Sales and trading
How are Investment Banks broken up, and give examples
By industry which is then broem up into dub catagories . Diversified, healthcare, etc
Explain the glass Steagall Act
Seperated the CB and IB in the US
FOrced CB forced to move to lower risk underwriting areas
IB firms were prohibited from egnaging in CB
What were they key objective of the Glass Steagall Act
Discourage speculation
prevent Conflict
restore Confidence in the systme
What was the Gramm Leach Biley Act
It repalced the XXX act in 1999. It allowed CB IB and insurance under the same
Explain the Emergency Econnomic Stabilization Act of 2008
Gave the gouverment permission to increase supply credit. AKA build America Bonds helped stimulate the municiapl secotr `
WHat are some Capital Raising services of IB and give 2 examples
Brinign New Securitires to Makret -Public Offering and Provate Placement
How do you bring a new security to market and explain each
Origination - Design of the security contract
Underwriting - IB buys the security
Sales and distribution
Best Efforts offer vs Underwritten offer
Does not gurantee a price of that the securities will be sold. More risk to the firm
- Underwritten offer IB guratees the isser a certain price
What is a private palcement
Underwriting is skipped nd it is sold direcly to the ultimate investor
When is restructuring most active
This tends to be most active during times of economic downturns