What’s a Private Investment Banker’s Role?

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Private investment bankers advise private companies on investment options and raising capital, manage investment portfolios, and handle mergers and acquisitions. They also handle large financial transactions, suggest financial ventures, and conduct research. Strong mathematical, analytical, and accounting skills are required, and most bankers hold an MBA.

A private investment banker is a representative of a financial institution, or investment bank, that works with private companies. He or she can provide the company or client with advice regarding investment options and methods of raising capital. A private investment banker also manages the company’s investment portfolio. Private investment bankers do not offer loans or accept deposits from the general public.

One area that a private investment banker can work on is mergers and acquisitions. For example, in the case of a merger, the banker will try to find a buyer or company whose strategic objectives suit the company being sold. In the case of acquisitions, where the company is trying to buy or acquire another company, the private investment banker will look for companies that are a good fit for what the company wants to buy.

If a merger or acquisition is questionable, the banker will offer the client advice on how best to proceed. Once a sale is made, he or she can help the business restructure its finances to be more viable. A benefit of private placement is that it eliminates any hassles associated with a public company that is for sale.

A private investment banker also handles large financial transactions, arranging and negotiating. He or she will also work to address financial failures or budget deficits in a private company. This type of banker can also suggest financial ventures for the company to undertake.

In addition to the financial side of a career in private investment banking, many bankers are also involved in research. This may involve studying the market and looking for similar companies, although this is limited to publicly traded companies due to the availability of their financial information. Studying financial documents is another part of the research that a private investment banker may be asked to complete. Using the acquired research, the banker often writes reports and makes recommendations to his client based on the research results.

Being a private investment banker requires strong mathematical, analytical and accounting skills. It sometimes requires the banker to work well in high pressure situations. While in some cases a bachelor’s degree is sufficient to attain a position in private investment banking, most bankers hold a master’s of business administration (MBA). Some of the courses required to be a successful private investment banker include courses in finance, statistics, accounting, economics and business administration.

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