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Investment Banking Regulations in India: A Comprehensive Overview

Posted on by Imarticus Learning
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Investment banking is a pillar of contemporary financial services, supporting investment, company growth, and wealth generation. Investment banking operations have expanded dramatically in India, a fast-rising economy with a thriving financial industry. Investment banks contribute to the nation’s economic growth and dynamism through financing securities involving mergers and acquisitions and conducting initial offerings to the public.

However, with tremendous financial strength comes immense accountability, and investment banking operations necessitate a strong regulatory framework to protect the security and reliability of the financial sector. The regulatory framework for investment banking in India is complicated and dynamic, reflecting the desire to strike a fine balance between encouraging innovation and protecting the needs of clients.

In simple terms, this detailed analysis guides India’s maze of investment banking regulations. It emphasises the crucial function of regulation in ensuring financial security and investor trust while cultivating a robust investment banking sector. As we explore the complexities of India’s investment banking legislation, we hope to provide readers with a thorough grasp of this essential aspect of the country’s financial environment.

Regulatory Authorities in Investment Banking

The function of regulatory agencies in monitoring and regulating the activities of the investment banking industry is essential. Several regulatory authorities in India are in charge of overseeing various parts of investment banking services. The following are the primary regulatory agencies involved:

Securities and Exchange Board of India (SEBI)

Officially known as the Securities and Exchange Board of India, SEBI serves as the paramount regulatory body responsible for India’s finance industry. Its jurisdiction extends to a wide spectrum of functions:

  • SEBI supervises and governs stock exchanges, providing equitable and open trading procedures. It establishes and upholds market laws to avoid fraud and manipulation of the markets. 
  • The major concern of SEBI is to protect the interests of investors. Preserving investor interests requires corporations and market facilitators to make disclosures, be transparent, and use fair practices.

Regulatory Framework

SEBI is governed by the SEBI Act of 1992, which authorises it to regulate India’s securities markets. Furthermore, it gets its jurisdiction from the Act’s different rules and directives. 

Reserve Bank of India (RBI)

RBI operates as the nation’s central bank, holding a substantial mandate in managing and evaluating nationwide investment banking activities. Let’s dive deeper into its role!

Monetary Policy: The Reserve Bank of India formulates and enforces financial regulations that impact inflation, the flexibility of the financial sector, and the range of services offered by investment banks.

Prudential standards: To guarantee financial viability and handle risks, the RBI established prudential guidelines and norms for banks and financial firms, including those involved in investment banking.

Investment Banking Prudential Standards:

The RBI has established prudential standards for banks and financial companies engaged in investment banking. To alleviate the risks connected with investment banking activities, these guidelines include adequate liquidity regulations, risk management recommendations, and exposure restrictions.

Ministry of Finance

The Ministry of Finance is a major branch of government in India that is in charge of the country’s financial and economic concerns. It is vital in shaping investment banking regulations:

Fiscal Policy: The Ministry of Finance creates and executes fiscal strategies that affect investment banking activity. Taxation, tax incentives, and allocations of funds all have an impact on the investment climate.

Government Securities: The ministry oversees the issuing and handling of securities issued by the government, which are essential components of the Indian economy. Government bond offerings are frequently attended by investment banks.

Regulatory Framework for the Banking Sector

Under the Banking Regulation Act of 1949, the Reserve Bank of India (RBI) governs the Indian financial sector. A few key features of the banking laws are discussed below.

Priority industry lending

The priority category includes micro and small businesses, as well as projects in food production, learning, housing, and financing to less privileged populations. The funding target for domestic commercial lenders and foreign banks with over 20 locations is 40% of adjusted net credit to banks.

New bank licence requirements

According to the new requirements, firms requesting a licence must have a track record of achievement of at least ten years, and the bank must be administered by a non-operative financial holding corporation (NOFHC) completely controlled by the organisers. 

Conclusion

India’s investment banking sector is positioned for continued growth and development. Recent advancements and reforms have resulted in regulatory changes that affect the markets and financiers. Understanding these regulations while predicting future patterns and problems is crucial for both authorities and industry participants, a skill set that can be developed through an organised Investment Banking Course.

Explore the Global Landscape of Investment Banking Regulations with the Imarticus Certified Investment Banking Operations Professional Programme. This course aims to teach you about the banking industry, handling risks, and complying with regulations. Furthermore, it provides the understanding and skills required for a successful, qualified interview with the best firm.

Capital Structure Optimisation and Capital Raising Strategies

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Effective capital structure optimisation and capital raising strategies are crucial in shaping a company’s financial health and growth prospects and are important aspects of investment banking.

The composition of a company’s debt and equity, known as its capital structure, significantly impacts its ability to finance operations, pursue strategic initiatives, and maximise shareholder value. This blog explores the key considerations and strategies involved in capital structure optimisation and capital raising, considering the nuances of financial flexibility, fiscal discipline, risk management, and growth aspirations.

Capital Optimisation

Capital optimisation refers to managing and balancing the receivables and payables of an organisation. An organisation can establish a practical solution with minimal disruption while accomplishing the desired effect with capital optimisation. Usually, an optimal capital structure of an organisation is the perfect balance of equity and debt.

For an organisation, debt is cheaper than equity as it costs less in repayment. However, debt can also cause an organisation to go bankrupt. Organisations must find the point at which the benefit of debt equals the cost of operation.

How to optimise a capital structure?

Deciding an optimal capital structure for an organisation can be very difficult. Before making the final call, managers must consider the impact of their decision on the market.

The most practical approach for a company is to raise capital using debt rather than equity, as debt signalling is positive news. Additionally, debt is cheaper than equity as companies get tax relief on interest.

On the other hand, raising capital through equity can cause dilution and is considered a negative signal. Equity is also costlier because the company pays the dividend from the after-tax income.

The debt or interest tax shield is a significant solution for optimising capital structure. It helps reduce the tax amount from the debt interest payments. The calculation process of the tax shield is given below.

Interest tax shield = Interest expense deduction ✕ Effective tax rate

Capital Raising

Capital raising is the procedure an organisation undertakes to acquire funds required for new projects and expand old projects and businesses. 

The organisation can issue stocks or bonds to its investors in exchange for their investment in the company to raise capital. These stocks usually offer the investors a share in the company.

There are various ways to implement successful capital raising. These include Initial Public Offerings (IPO), private placements, venture capital funding and crowdfunding.

Strategies for Raising Capital

Capital raising is primarily of three types, as described below:

  • Financing Debt

Debt financing means you must pay the principal amount and a fixed interest you agreed on back to the lender. 

Third parties pay the fund or the capital in debt finance. Such lenders include banks, bond markets, financial institutions, and private equity funds. While raising debt means access to fast cash at a low-interest rate, it also entails a decrease in the credit ratings of an organisation. 

Debt repayment does not depend on the company’s business performance. Hence, the debt must be repaid even if a business is not performing well.

  • Financing Equity

The second most common way to raise capital is through equity financing. Equity financing is raising funds by selling equity or a share in the company’s ownership.

The investors can be anyone with the funds available to them to meet the valuation of the stocks set by the company or its owners. The stock market is the most crucial method for raising equity. The company must not, however, overvalue its equity, or it will lose prospected investors.

The most significant advantage of equity financing is that no interest repayment is required, making it a much less risky approach than debt financing. However, it also means giving up a portion of your control over the business and consulting the investors or shareholders before making significant decisions.

  • Hybrid Financing

Hybrid financing, as the name suggests, is a combination of debt and equity financing.  A hybrid financing solution is a lot more flexible as it provides both the company and the investors with a lower-risk option. It also ensures access to a broader range of investors.

The negative side of hybrid financing is that it is more complex and often gives investors an upper hand over the company’s expenses.

Conclusion

Optimising capital structure and implementing effective capital raising strategies are critical for businesses aiming to achieve sustainable growth and maximise shareholder value. Striking the right balance between financial flexibility and fiscal discipline, aligning capital structure with business strategy, and employing various optimisation strategies can help companies navigate the complex landscape of capital management. An investment banker can help with this.

Enrol in Imarticus’s Certification in Investment Banking Operations programme to learn the fundamentals of financial markets, trade life cycle, risk management and regulations. This investment banking course has a job-focused curriculum and offers dedicated career services for candidates seeking a career in investment banking.

Career Choice Comparison: Asset Management vs. Wealth Management

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Individuals and businesses deal with significant volumes of wealth and assets. Those who wish to focus on assets and the various ways of increasing and monitoring them can opt for asset management jobs. Candidates who are more focused on the overall finances can go for a wealth management degree.

Imarticus Learning’s CIBOP or Certified Investment Banking Operations Professional course offers a curriculum that includes both fields. Students can explore various options and choose their area of expertise at the end of the course.

best investment banking courses with placement in IndiaUnderstanding the Difference Between Asset Management and Wealth Management

Asset management deals with the investments of a company or clients. Asset managers are responsible for the money that clients invest. Asset managers take care of all investments, helping people follow the right procedure to set up accounts and invest in the right areas.

Investors can hire asset managers to assist them in opening accounts, finding the best investment opportunities, and finally making the trades. Asset management involves extensive risk management and research.

Managers need to research the condition of stocks, bonds, mutual funds, ETFs, or other forms of investment vehicles. After analyzing the research data, asset managers can accurately predict where one should invest to get the maximum benefits. Nowadays, asset managers are also responsible for ensuring that all investments are socially responsible.

Some asset managers may work in other aspects of investment management like tax-loss harvesting. An asset manager can at times provide financial advice. Since they have expertise in investment vehicles, individuals or firms that provide ETFs, mutual funds or similar products often hire them to get a better idea of what response their products will receive.

Wealth management deals with a broader view and includes all finances of a company or individual. Wealth managers have multiple tasks. Similar to asset managers, wealth managers have to conduct a risk assessment. A wealth management course usually prepares students for this task. Wealth managers are often hired by company stakeholders or older employees who require retirement planning services. Since wealth management involves monitoring individual wealth, managers can help clients choose the right retirement benefits.

Several clients also hire wealth managers for succession planning and estate planning. Wealth management also often involves the set-up and management of trusts. People who require insurance protection can seek the assistance of wealth managers. Wealth management often includes coverage of liability issues, stock options, and tax planning.

While there are differences in the services provided by asset managers and wealth managers, one also needs to look at the various compensation models. Asset managers usually take commissions. Their fees are based on the type of assets they are managing. Wealth managers, on the other hand, charge on an hourly basis or have flat fees. However, if they too are dealing with assets, their fees may depend on the size and value of those assets.

What Can Candidates Study to Work in Asset or Wealth Management?

Both asset and wealth management has a lot of scope and aspirants can benefit from honing their skills in either field. While there are several wealth and asset management courses, Imarticus Learning’s Certified Investment Banking Operations Professional course teaches students the skills necessary to land lucrative jobs. The institute organizes live lectures where candidates are encouraged to interact with peers as well as instructors.

The curriculum introduces students to financial markets. An understanding of the market trends is beneficial for both asset managers and wealth managers. Risk management is also a huge part of the course as it is extremely important for the industry. Candidates are prepared for interviews in their areas of interest and are guaranteed job interviews once they graduate.

The CIBOP course doubles up as a risk management course in banking and aspirants will benefit from the industry expertise offered. Such a holistic approach increases opportunities for all those who complete this degree.

What are Good Ways to Prepare for the Interview for an Investment bank

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The investment banking career is considered as one of the most sought-after and rewarding careers in the finance and banking field. Investment banks play a major role in effectively channeling funds in the economy and guiding their clients on profitable investment avenues. The investment banker has a very wide range of responsibilities and plays a dynamic role in the investment banks. The job of an investment banker in no way is easy to do and requires a lot of additional hours than a normal job. The high remuneration reflects the work that investment bankers are required to put it.

The primary role of an investment bank is to help raise capital for its client from investors or through public. Investment banks leverage its large professional network to find out suitable investors and match them with borrowers in need of funds. Investment banks play a key role during the Initial Public Offerings (IPOs) and act as an underwriter during the process. They help with finding out the optimal price of shares and also hedge the risk of under subscription to some extent. In addition to this investment banks also helps with the Mergers and Acquisitions deals.

Tips for Investment Banking Job Interview

Preparing for an investment banking interview can be challenging, especially when there is so much competition and such huge stakes. Let’s delve deeper into how you can stand out from the competition and land your dream job.

  1. Learn all about investment banking: The investment bankers have a huge role to play in the success of their company and also of their client’s firm. You should know all about the investment banking industry including the day to day chores, financial modelling and valuation, accounting standards, regulatory challenges, etc. You should be prepared to answer all technical questions related to the investment banking sector. You should also be aware of the latest industry trends and news. For example: learning about popular mergers and acquisition deals.
  2. Know your why: Be prepared to answer this question sooner or later during your interview process. You should know your ‘Why’. It is one of the most important questions as it shows how passionate you are about this job and what you are willing to become successful. Since investment banking involves long hours, people who are just in it for the perks without working hard are not able to survive for long. If you are passionate enough, you will give your best without complaining about the hours.
  3. Demonstrate what you can do: Your interviewers are most likely the people you will be working with in the future if you land up the job. If you can successfully demonstrate your skills then there’s no way you won’t get the job. You should be as specific as possible while answering your questions and it is advisable to use relevant examples and scenarios that allow you to demonstrate your skills. You should be able to show them how you will add value to the organization and what all you bring to the table.
  4. Communicate effectively: The role of an investment banker involves dealing with clients and communicating your ideas and knowledge with all key stakeholders. You need to have good communication skills to be able to convince your clients. You should communicate effectively during your interview as it has a big role to play in your day to day job.

There’s a whole lot in the realm of investment banks and bankers to make this role crucial for the economy. It can be very hard to break into the investment banking industry as the role and status of an investment banker lure in a lot of aspirants who want to become successful investment bankers. Opting for an investment banking course from reputed institutions like Imarticus Learning helps you to develop all essential skills and retain relevant knowledge required to do the job. It also guarantees job assurance with reputed companies in the industry.

Also Read: Top 20 Investment Banking Interview Question & Answer

How Does Imarticus Learning Help Students Place at Top Companies?

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Aman Jain explains how he got placed in top-tier companies after Imarticus Learning’s CIBOP course.

I just completed my B.Com and after which I got enrolled in the CIBOP course from Imarticus Learning. The course is excellent, and I got placed in CITCO almost immediately after the completion of the course.

The Imarticus Learning placement assistance process was very smooth. The placement team at Imarticus is helpful and supportive, and the communication between the placement team and the candidate was top-notch.

The course prepared me for my future career.

I have given two interviews so far, both of which were organized by Imarticus Learning. I was selected for both companies but opted for CITCO.

My overall experience at Imarticus Learning was pretty amazing. The one thing that I appreciated the most about my time at Imarticus Learning was that I gained heaps of knowledge which will prove very valuable as I transition into my professional career. As a bonus, I also made many new friends!

If anyone wants to make a career in investment banking, then Imarticus Learning is the best place to start.

I would rate the faculty 5 out of 5 because the teaching methodology at Imarticus Learning is unique. While I was pursuing the Post Graduation Program in Investment Banking, the faculty taught with both a practical and theoretical focus. It helps students understand the concepts very efficiently.

As this is my first job, I would like to thank Imarticus Learning. I am very excited to start my new role as it’s an entry point into the larger corporate world. I hope to learn as many new things as possible.

 Ready to springboard into the investment banking world? Chat with our counsellor to find out how to start.

What is Difference Between Investment Banking and Corporate Finance?

Posted on by Imarticus Learning
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Both investment banking and corporate finance deal with financial transactions and banking with some key differences. While investment banking deals with growing a company through raising its capital base the corporate finance division deals with managing the company and its daily operations and its goals for business both long and short term in nature. IB operates in raising capital for the company in the form of securities in the equity and debt markets. The IB also helps advice clients in acquisitions, mergers, placing investments, and executing financial research and analyses.

Another glaring difference between the two pertains to the experience and academic qualifications required to be in investment banking being higher, more demanding and expensive when compared to those required for the corporate finance banker.

However, there is a lot of overlap in the two areas in terms of educational qualifications and job-skills required for both areas. Thus one can expect the IB requisite skills to also apply for the corporate finance FAs.

Pay Packages:
In the US the financial analyst in IB had an average salary of 84,300 USD as reported in 2017 by the BLS. The CFO salary had an average monthly pay package of 104,700 USD.

According to Wall Street Oasis, the starting career step of a junior IB analyst was in the range of 70,000 to 150,000 USD annually with negotiated bonuses and performance incentives added in. The BLS predicts 11 percent growth in FA positions between the decade starting 2016. This is better than the 8% anticipated growth for the corporate FAs.
Payscale reports the investment banker salary is an average salary of 508, 855 Rs for a fresher.

The salary components can vary between 177,560 to 1,545, 630 Rs while the bonuses can vary with contract negotiation from 2,517 to 524, 023 Rs depending on your skills and performance. In the US this is between 75-90k pa and an average total of 140k pa for a fresher.

Thus the total payouts can be much higher depending on performance and bonuses. Doing the investment banking course helps you earn a global measurable certification which validates your skills and knowledge and is acceptable as real-life experience of the financial and investment banking experience requirements preferred by most employees.

Difference Between Investment Banking and Corporate Finance

The major difference in the two segments pertains to salary or payouts and work-loads.
Burnout occurs with long working hours and much work. More than one-half of the banking job aspirants, especially in IB, quit in the first three years!

The IB teams are generally small and lean with one analyst, two associates and a VP reporting to the Lead Director. And the working is inverted bottom up, meaning they bear all the workload. An 80 to 100 hour week with working Sundays is not uncommon and social life grinds to a complete halt.

In contrast, FAs in corporate finance jobs benefit from the corporate culture and the working hours are definitely not as punishing. The FAs in IB though receive a flat percentage of their business meaning their take-home pays are way higher and performance-based.

There is a lot of prestige in IB jobs, and in the same breath, corporate finance jobs are not so easy to get and are still a good career choice. Aspirants for the allure and prestige of the IB job need to work harder, with more work-loads and long hours when compared to the FAs of Corporate Finance. That’s why they get paid higher and ascend the ladder quicker.

The ladder to climb in IB starts with the junior position, to an Associate role in 3 years leading to the VP role and then the Lead/ Managing Director etc. Corporate finance offers many opportunities as advisors, accountants, account managers, treasurers, analysts, business analysts etc.

Conclusions:
The prestigious investment banking job allows you to either start as a Junior Analyst with an under graduation or as an Associate with experience by doing your Banking and financial course with a reputed institute like Imarticus Learning. The requirements are no different for the corporate finance sector.

However, specialization and certification in the area or vertical you are interested in help. The prestigious Investment Banking jobs are generally filled with ivy-league business school graduates especially in reputed companies like Morgan and Stanley or Goldman Sachs etc.

Doing the Investment Banking Course at Imarticus is the short cut to a great Investment Banking career. Why wait then?

The Truth About Different Technology Jobs in Investment Bank

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Investment banks also use technologists and place them in various roles. It is definitely not the regular technologist’s job role where you get to coding and developing the environment. So let’s explore what the job roles in asset management, investment banking or trading and securities sales actually imply for the technologist. Don’t be surprised that though you are in IB the role of the technologist is highly reduced, close to shamming being busy and definitely does not offer learning experiences in most areas. One of the best ways to understand and blend your technological degree with IB techniques and roles is to do an investment banking course at a reputed institute like Imarticus Learning.
1. Role of front-end technologist:
It appears most technologists prefer working in the front-office end of investment banking jobs. This means they are tied into the business and need to think of working with the banking team, commodities, rates, equity derivatives, asset management and portfolio management. As the technologist at the front-end one would expect to be developing quantitative tools like pricing engines, position blotters, tools for banking, research platforms, feeds to back and middle offices, market-research for the data teams, and booking services amid other challenges. You may be disappointed but that is not what happens. Most banks have large support routines, lack of funds for improving frameworks and work in very lean teams where the most prioritized and high-security routines are given to only trust-worthy individuals only.
2. Role of core technologist:
If you love interacting with other developers in the same industry and keeping pace with the trends then these are the ideal investment banking jobs for you. The core technologist’s role does not impact day-to-day activities of the bank and hence it is a matter of interacting with the teams for long term strategic development that may never materialize and keeps getting iterated to keep the technologist feeling important and busy.
3. Role of back or middle-end technologist:
The compliance and Regtech teams work at the middle and rear-ends. You can expect to rush to meet deadlines that are mandatory, marketing risks, pitching settlements, ensuring payments, monitoring and creating valuation controls and raising and monitoring the capital management.
4. Role of IB technology infrastructure job:
Banks are moving to cloud technologies and this is definitely a thrust area for all banks. As the technologist, you can expect to work both on captive and external cloud databases and hence you can make use of your repository of tools in building tools. The teams here are highly specialized and distinguished. This also puts cybersecurity up in front. Either of these areas is very desirable and fulfilling as a technologist.
5. Role of IB business analysis technologist:
As a technologist in business analysis, you could work at any end of the bank. Front, middle or rear-ends. The BA technologist’s role is the bridge between the developers and the business itself. However, the scope is limited since at most banks the technologists are expected to be cheaper forms of business management and monitoring and in all probability will be having developers interacting with the business analysis functions without interactions cutting across the various IB areas and its inert dependence and complexities.
6. Role of IB PM Technologist:
On the project management team, you can expect to have a full calendar of meetings with the bossy project manager, developer teams, delivery milestones, late and unmet deadlines. The technologist role is basically of a go-between for various cross-functional and multi-area teams working on complex banking technology products.
Conclusion:
Working as a technologist in IB can be quite challenging and definitely not the traditional role of developer or analyst among the investment banking jobs. The technologist is however considered special to the banking team and is paid-well, works fixed hours and can rise quickly if personal communication and lack of fixed job functions or roles are imbibed.
Do your investment banking course at Imarticus Learning to understand what exactly happens behind the scenes at IB jobs. They help you get IB certification, find good jobs through assured placements and ensure you are job-ready from day one. All the best in your new role as a technologist in IB!

Top finance Management Jobs for 2019

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Wondering where to head after completing your graduation in the finance department? Well, there are a plethora of opportunities to start your career in the field of financial management. Though it is one of the most competitive areas, yet there exist several occasions with the benefit of being paid high as compared to another sector.
It would be tough to find your dream job straight after graduation as the industry is enormous and certifications make you’re better suitable for a significant position. You can start with the entry-level jobs and then expand your knowledge to gain expertise in the particular field.
Also Read : Importance & Scope Of Corporate Finance

The Earlier, The Better

Financial Institutions prefer good grades from the start. The essential requirement to enter the finance world is an undergraduate degree yet having an exceptional knowledge about numbers would leverage your chances of being hired. Since, your prime focus in on working with firms or organisation, it is preferable to have a background in economics, accounts and maths. Someone with exceptional skills and knowledge about the current market trends is preferred for a job in the finance sector.

Job Opportunities

Finding a job might seem harsh but only if you look at specific areas or the right place to opt for an opportunity could you avail the offer. Several online websites such as Linkedin or the Naukri provide a plethora of options to find the right job, yet surfing websites that are specifically meant to provide finance-related employment would be profitable.
The prime concern is to look for the various job opportunities that lie in the sector of the finance industry. A profile that would provide not only money but also opportunities to grow in the long run.
Here, we have the top three jobs in 2019 you can consider while looking to start your career with:

Financial Analyst

The current market conditions witness rise and fall of the economy that affects the different organisation. Seeing such transition, organisation seek professional that could guide them to make a significant investment and also provide relevant advice about the capitals of the organisation so that they can maximise profits.
A financial analyst is responsible for analysing the macro and the microeconomic data of an organisation that would provide a recommendation related to the marketing sector. Primarily, they work in investment banks and help the organisation to indulge in buying or selling of stocks. The essential requirement of being a financial analyst has a bachelor’s degree. An MBA graduate would be a plus for entering the finance industry.

Banking Analyst

The investment banking analyst is responsible for analysing the transaction initiated by the banks and then create presentation thereby guiding the investors or the bankers. The analyst would be expected to report to the banker while working with the investment team.
The principal duties to be performed by the investment banking analyst comprises of analysing the financial data to provide portfolios. An in-depth study to be done of the stock performances allow them to suggest a recommendation to the bankers. The analyst would also be required to generate reports and draft presentation to support his findings.
The prime requirement to opt for the entry-level job is a bachelor’s degree. However, banks prefer someone with an MBA degree.

Junior Tax Associate

One of the ideal job profile for the just passed graduate to start their career in the finance industry is the role of a junior Tax Associate. The prime purpose of the professional is to examine several records of the company such as documents of expenditure or the tax statements so that it can determine the amount of tax the client owes along with providing all the relevant taxation reports to the same.
It works for an individual client to review his annual income and provide significant insights into the obligations due on the client.
You need to have a bachelor’s degree in the Accounting Field to be suitable for the job profile of a tax associate. Knowledge about subjects of economics, accounting and statistics with finance is preferable.
Related Article : Importance of Financial Analyst in a Company

Career and Scope of Investment Banking in India

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Investment banking is a truly up and coming career option that is becoming growingly popular among the ambitious youth in India. An investment banker, simply put, is someone who helps their client (often a bank or a financial firm) invest their money in a way that will help them yield the highest possible returns. These jobs come with a lot of responsibility like dealing with debt, stocks and bonds, mergers and acquisitions, securities and derivatives.

Being a successful and good investment banker is bound to be a challenge. Cracking this code requires you to be great with numbers. In addition, you need to also possess substantially good verbal and written communication skills. Honing your presentation skills will also benefit you enormously to land that dream job. Investment bankers are required to do extensive research of the market before making any suggestion about potential investments and would thus need to have their research and analysis skills on point. Endurance is also a key in this highly-stressful job with long and, often, odd hours.

That being said, there are also a number of reasons the youth in India is flocking towards this career. It is an exceedingly rewarding job with rewards in monetary terms as well as personal and career growth. It is a fast-paced job that requires you to be on your toes a lot and be constantly updated about the market – which changes a lot. This leaves an enormous scope for learning which is a truly valuable thing in anyone’s career. Another very important reason for this being a popular career choice in finance is that this job gives you pathways to bigger careers like entrepreneurship, wealth management and venture capital.

A huge reason for the growth of this career over the past few years in globalisation which has led to a booming financial sector. India is a rapidly growing economy with numerous multi-national companies setting up shop around the country. This has opened up several available positions for students who specialise in investment banking.

The good news for anyone considering this career is that you don’t require any specific stream. You can get into the field irrespective of if you have a background in science, arts or commerce as far as your subjects are related – like maths and economics. As for higher education, any aspiring investment banker in India is required to have an MBA degree (Masters in Business Administration). Some institutes also provide diplomas and certificates while some even conduct workshops for investment banking. Top institutions in India for the field of investment banking are ones like Institute of Chartered Financial Analysts of India University and Symbiosis School of Banking Management.
Along with your education, to get into this competitive field, internships are going to be your best friend. The more well-known the company you intern at, the better your CV looks to the recruiter and the better your chances of getting hired. But even getting a good internship is hard so you can always start out small at a smaller bank or a boutique firms. Experience is a key to rising higher as an investment banker and internships are meant for the exact purpose. Top Investment Banks like the Citi Group, JP Morgan and Deutsche Bank are great places to aim at.

With your degree in hand along with your internship experiences, you can expect to earn anywhere between 6-7 lakhs per annum which will only grow leaps as you work more and gain more experience. If you think that you can efficiently fill the requirements and have a passion for finance, Investment Banking is the ideal choice for you.

Also Read: Is Investment Banking High Paying Job

The Way Banks Have Evolved Over Time

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With banking direction at a record-breaking high, quantity of establishments seems, by all accounts, to be at an untouched low, and still on the decay. Mergers and acquisitions are on the ascent, yet sanctions proceed on a descending winding, with states the nation over all observing comparative patterns.
So where has all the managing an account was gone and what is banking today? Merriam Webster characterizes banking or investment banking “as the matter of a bank or financier.” In substantial part, that business includes sending stores as an advance to borrowers; these assets having been acquired through a development of stores and capital.
It shows up as though purchases and organizations alike are looking to elective wellsprings of financing generally alluded to as FinTech; sources outside of customary banks, where endorsing necessities may be fairly more liberal, terms more adaptable and insurance all the more broadly characterized.
Today, that same industry part could now be all the more in exactly depicted as a “wellspring of assets,” which can, as a rule, be gotten to on the web. This makes the loaning exchange geology unbiased and speedier from application to endorsement to financing.
Consider the accompanying option loaning choices:

Peer-to-Peer (P2P)

Where an online stage matches moneylenders and borrowers in light of specific information which can be electronically assessed momentarily; loan specialist overhead expenses are commonly lower and financing costs focused in light of the credit nature of the borrower. “In the vicinity of 2014 and 2015, the estimation of worldwide P2P loaning was relied upon to ascend to an esteem seven times what it was in 2014 – from 9 billion to 64 billion U.S. dollars. By 2050 the esteem is relied upon to be near one trillion U.S. dollars.”

Crowdfunding

For the most part don’t require reimbursement and ordinarily get financing from an expansive number of little commitments from people who bolster a specific business’ procedure and potential effect. Crowdfunding can appear as a value venture whereby the speculators advantage from future income and capital development of an organization, a gifts/rewards display, a loaning model or a consolidated model. It is evaluated that there are more than 375 crowdfunding stages in the United States alone and well more than 500 around the world. A few sources have dollars raised at over $8 billion. Be that as it may, given the assortment of stages used to request supports, a correct sum can’t be resolved.

Figuring and Merchant Cash Advance

Ordinarily, applies to less credit-commendable borrowers who get to financing in return for an expense and are reimbursed through the receipt of money on records of sales and future credit deals individually. A gauge for the overall volume is this space surpasses $3 trillion.
In spite of the fact that FinTech organizations keep on gaining energy using Big Data and innovation, conventional banks keep on holding by far most of the loaning piece of the overall industry. May 2017 measurements distributed by the Federal Reserve demonstrate add up to bank resources at $16,241.5 billion in the United States with $12,591.6 billion of that gathered in bank credit “i.e. loaning”. Still, as a rule, more stringent endorsing norms at customary banks have cut off access to certain new companies or battling organizations and therefore FinTech has ventured in to offer an option. A 2014 Fortune magazine article notes “… Startups in the monetary innovation field, or “fin-tech” as it’s normally called, are blasting, and huge foundations, for example, Bank of America, Citibank, and American Express are emptying cash into these agile new organizations to meet present day administrative, computerized and security challenges. Wander interest in worldwide FinTech tripled in the vicinity of 2008 and 2013 to $2.97 billion and is relied upon to reach $8 billion by 2018.”
While the field of Finance in terms of the industry has gone through various radicalizing changes, it has also resulted in great changes on the academics part of the industry. Today many top banks are seeking candidates who are thoroughly industry endorsed and have a formidable set of skills.