You could be wondering what an investment bank does. Investment banks have several functions ranging from dealing with mergers and acquisitions, raising capital, to security underwriting. The investment banking industry has undergone various changes since the 2008 financial crisis which led to the collapse of many financial institutions and a prolonged recession.
The Dodd-Frank Act, which emerged from the 2008 financial crisis, can be deemed to be the most substantial legislation that helped in improving the regulatory framework that significantly contributed to the financial crisis. The Act increased capital requirements and brought private equity firms, hedge funds as well as other investment companies to be considered as part of the “shadow banking system.”
At the time of the financial crisis, pure investment banks were forced to transform themselves into bank holding companies for them to be bailed out by the government funds.
Investment Banking Prospects
In 2010, the industry advisory fees were about $84 billion globally. This was the highest recorded figure since 2007. The future of investment banking not certain however since the industry still faces some significant post-crisis effects.
According to industry watchers, investment banks may start laying off its workers in the coming months as a result of the struggle with slowdown and placid markets. Some firms are already taking action such as Credit Suisse. The firm sent a memo to its investment banking division informing on the possibility of potential job cuts.
There are prospects of possible reduction of 10 percent in the average headcount across the investment banking industry in Europe in 2016.
At the beginning of 2016, the industry faced a weak start which has seen most banks in Europe record a go-slow in hiring employees. Most experts suggest that European banks, in particular, should focus more on “selective hiring” of their senior investment bankers who can help them in generating revenue. These banks need to do so to ensure they claw back the market share they have lost to Wall Street firms.
Madison Street Capital is an investment banking firm with global operations in financial advisory and valuation services, financial opinions, as well as merger and acquisition solutions. The global company runs various industry sectors across the world including Private Debt Placements, M&A transactions, Valuation, and Capital raising. Some of the firm’s clients are small to middle market business organizations in the U.S, fruitful and established firms that seek growth, international companies expanding its operations into the U.S, and international companies seeking capital providers in the U.S.
The investment banking firm has a team of experienced professionals who have exceptional knowledge and extensive relationships that enable them to effectively arrange the most suitable financing structure for the client’s situation. This makes Madison Street Capital a significant leading provider and premier middle market firms in investment banking. The firm has its headquarters in Chicago, Illinois and has offices across Africa, Asia, and North America.