Finance professionals are at crossroads when it comes to choosing a career in investment banking or private banking. Every year students in the finance field confront this problem. Private Banking offers a spectrum of services for high value customers. This is a sophisticated service that comes with special features for the high network individuals. The services include currency hedging, small scale acquisitions, tax advice, asset disposition, mergers and portfolio management. Investment banking or corporate banking, on the other hand, offers products and services to large corporations and Consórcios across the globe. This is also similar to corporate banking that deals with project finance, equity financings, takeover defense, equity share repurchases and convertible bond offerings.
The two are not independent of each other, and in certain cases the two overlap. When a thriving private limited company goes public, the need for investment bankers become inevitable. The assistance of private bankers is needed to give advice to the company on IPO related issues and also advise the owner and the shareholders on managing rights of public shares or their newly acquired wealth. Finance professionals can transit from private banking to investment banking with ease. Some of the beneficial factors related to private banking is that you can get contacts of top industry leaders and entrepreneurs who can be of useful contacts in the future. Wealth management is a growing terminology for big firms those who want to prevent unstable revenue streams, especially from investment banking. Exposure to banking products and flexibility of transiting to private banking makes these two types of banking versatile.
Investment banking also is beneficial especially during flow peaks. It enhances the learning curve even for the most seasoned bankers. Also, remember that business is a cycle and despite the best of precautions there may be downfalls. Deals are managed by teams and they are responsible for the corporate relationships. Both investment and private bankers work in coordination in large firms. The transition process always happens, and there is nothing unusual about it.