Investment banking or banking business that is specialized in obtaining, for private companies and governments, the money or the financial instruments needed to make certain investments, through the issuance and sale of securities in the capital markets.
Most banks offer investment advisory services for mergers, acquisitions and divisions and other financial services to customers such as trade or placement of future income, debts, stocks or commodities.
Generally countries require special licenses for investment banks and can not operate simultaneously as commercial banks, namely deposits.
Mutual funds, hedge funds and pension funds, whose objective is to maximize return on investment through the savings of the "buy side" of the securities issued and sold by investment banks. In some countries, firms operating both in the purchase and sale.
The financial crisis of 2008 seriously affected the major investment banks. In United States, Lehman Brothers requested credit protection before the law, informally declared bankrupt financial and main units were divided and sold. Meanwhile, investment bank Merrill Lynch was acquired by Bank of America, half of their real value and was acquired by Goldman Sachs Warren Buffett, Coca Cola princiapl shareholder. These three banks, as well as Morgan Stanley are converted into commercial banks, which the four largest investment banks in the world, ceased to be such.
All About Bonds, Bond Mutual Funds, and Bond ETFs, 3rd Edition by Esme E. Faerber (Kindle Edition - Dec 12, 2008) - Kindle Book