Abstract This study investigates the question: Do investmentbanks, because of their internal culture, lend themselves to the acts of fraudulent behaviors by some employees? This question is investigated through the testing of a related hypothesis. The HoHA research approach is followed in the formulation and testing of the hypothesis. The hypotheses are as follows:
Ho: There is no relationship between investmentbanking culture and acts of fraudulent behavior on the part of some employees of investmentbanks.
HA: The investmentbanking culture both facilitates and encourages some employees of investmentbanks to engage in acts of fraudulent behavior.
The hypothesis is tested and the research question is investigated through a review of high profile event in the investmentbanking industry over the past few decades. Investmentbanking is reviewed briefly in the following section, and this review is followed by a review of investmentbanking culture as reflected in selected high profile cases, including those of Michael Milken, Ivan Boesky, Nicholas Leeson, and Toshihide Iguchi.
From the Paper "The major operational functions of investment banking firms are underwriting, dealing, brokerage, and the provision of financial advice. The underwriting function involves origination, risk bearing, and distribution. Origination is concerned with defining the essential characteristics of an investment offering (debt or equity, pricing, timing, method of distribution, and so forth). Risk bearing on the part of an investment bank involves the purchase by a bank at a fixed price of a new securities issue, for eventual sale to the investing public (Pugel & White, 1995). In this context, the investment bank is at risk until the new issue is sold. Distribution is the act of selling the issue to the investing public. The provision of financial advice accompanies the underwriting function, although financial advice is also provided in other instances, such as, in conjunction with merger and acquisition decisions."
Abstract This paper explains that issuers of securities and investors are the two major players in the investmentbanking industry. The author points out that investment bankers usually act as intermediaries by advising and assisting corporations in issuing securities and often underwrite the issues by purchasing the instruments directly from the firm and reselling them to the public. The paper relates that the public purchases securities to add to their investment portfolios. The author discuses that investors have numerous instruments from which to choose, depending on factors such as risk tolerance, personal preference and tax considerations. The paper states that stocks and bonds are among the most prominent of investment vehicles; however, instruments such as treasury bills and certificates of deposit (CDs) are also used to construct well-diversified portfolios.
Table of Contents
InvestmentBanking Process
Asset Classes
Capital Market Instruments
Portfolio Recommendation
Conclusion
From the Paper "Certificates of Deposit are time deposits held at banks. When the term of the CD ends, banks pay interest and principal to the depositor. Though terms vary widely, short-term CDs are the most marketable. Unlike many other investments, CDs are insured by the Federal Deposit Insurance Corporation (FDIC); which provides a reasonable trade-off between risk and return. Derivatives are financial arrangements that are derived from other benchmarks. Including items such as currency, mortgages, and stocks, derivatives are loved or loathed depending on the investor."
Abstract The overturning of the Glass-Steagall Act has spawned numerous discussions and debates concerning the resulting effects. This paper reviews literature aimed at explaining the effects the FSMA has had on the values of commercial banks, investmentbanks, and thrifts, as well as the of effect of deregulation on corporate customers and the conflict of interest versus certification of value debates pertaining to commercial banks operating in the securities market.
From the Paper "Studies done to date, in respect to the deregulation of commercial banks, are not sufficient and in some cases may have missed the boat. For instance, the study conducted by Czyrnik and Klein included thrift stocks (a variable of seemingly little importance) and excluded corporate customers. It would be interesting to see the results of a similar study concerning FSMA's effect on the value of corporations who use investment banks compared to those who use commercial banks for underwriting IPOs. A study of this nature would serve well to examine the possible effects of commercial banks tying investment banking to credit offerings. Another possibility for a future study would be to interview investors with question regarding their perceptions concerning conflict of interest or certification of value that may or may not attribute to commercial banks engaging in underwriting securities."
Abstract This paper explains that the IT department of the Citigroup's Global Corporate and InvestmentBanking (GCIB) implemented a revolutionary system called Mystic. The author points out that Mystic was designed and developed to not only be a transparent window into the status of all of Citigroup's GCIB IT projects but also a technology catalog, a knowledge library, a reusable asset manager and a global talent manager. The paper relates that Citigroup's Knowledge Center, an incredible asset for the organization, identifies experts in their field, which allows Citigroup to utilize these people as effectively and efficiently as possible, where their skills are needed most.
Table of Contents:
Introduction
The Competitive Forces Model and Citigroup's GCIB Competitive Strategy
The Business Model Processes Using the Value Chain Model
Importance of Information Technology to Citigroup
The Introduction of Mystic
Advantages of the Citigroup Knowledge Center and Application by Any Large Organization
Conclusion
From the Paper "Inbound logistics includes items such as inventory control, and is one of the facets addressed at Citigroup with the implementation of Mystic. As noted, Mystic is not simply a project monitoring tool, it is also a technology catalog. Citigroup is able to manage their inventory of technology using Mystic to monitor where the technology is being implemented, how effective it is, and to warn as it nears the end of its lifecycle."
Abstract This paper outlines the main characteristics of hedge funds and looks at how these differ from traditional investment funds. There are over a dozen investment techniques used in hedge fund industry in order to make returns. The paper describes four of them: opportunistic, market neutral - securities hedging, global macro and value investment style. The great size of the assets under management of the hedge fund suggests that they are important clients of investmentbanks and can play a significant role in the financial markets. The paper also takes a closer look at how investmentbanks work with hedge funds and what impact the hedge funds have on the overall stability of the financial markets.
Outline:
Introduction
An Overview of Hedge Funds, Comparison to Traditional Funds and Their Importance as Clients of InvestmentBanks Recent Expansion of Hedge Funds
Hedge Funds and Financial Stability
Some Risks Associated With Hedge Funds
Regulation of Hedge Funds
Hedge Funds' Investment Styles
Conclusion
From the Paper "The definition of a hedge fund is an investment institution, which actively manages its portfolio using a large number of strategies and leverage in order to produce high returns, which are measured in absolute terms and/or over a specified benchmark, such as FTSE100 in the UK or the DOW30 in the US. Hedge funds are similar to the traditional investment funds in that they are both pooled and professionally managed, however, there is a number of differences. Unlike traditional funds HFs are practically unregulated and have the flexibility in their trading and investment strategies, e.g. go short when markets are bearish or when a manager thinks that an asset is overpriced and is due a correction (source: Investopedia)."
This in-depth paper a provides a benchmark pertaining to the careers of bank managers in Pakistan, while also delving into the banking industry in the Islamic run country.
Abstract This well-researched paper examines Pakistan's evolving and constantly developing banking industry from the 1940s and up the present. The writer of this paper supplies in-depth insight into the pressures as well as the numerous financial and cultural demands and expectations currently facing bank managers in both the private and public banking sectors. This paper analyzes Pakistan's political history and its resulting impact on the country's banking industry. The writer of this paper delves into Pakistan's socio-political culture which greatly affects the vision, goals and leadership style of the country's bank managers. This paper also contains various financial tables, lists and illustrated graphs pertaining to this particular topic.
Table of Contents:
Abstract
Introduction
Political and Financial History Intertwined
Effect on Pakistani Bank Managers
Cautionary Tales
The Opposite Side of the Coin
Pakistani Banking Structure
Pakistani Banking: Recent Past
Upsetting Events in Pakistan's Banking History vis-a'-vis Managers
The Best Bank Other Banks Challenges for Managers in the Banking Industry
Current Initiatives
Literature Review
Summary
Statement of Research Question
Methodology
Findings
Manager One: NBP Managers
Manager Two: New Hire from Lahore Business School
Manager Three: Year 2000 Graduate of a Business College in Germany
Manager Four: Islamic Bank Manager
Manager Five: Graduate of Irish Business College
Manager Six: Recently Promoted Manager at a Local Branch in the Capital
Manager Seven: Human Resources Manager at the Islamic Bank Manager Eight: Temporary Branch Manager in Small Town
Manager Nine: Former Bank Employee, Government Bank Manager Ten: Graduate of Lahore Business College (2)
Bank Manager Career Themes
Discussion
Conclusion
Appendix A: Islamic Modes of Financing
Appendix B: Recent Listing of Banks Operating in Pakistan
Appendix C: Questions for Bank Manager Interviews and Process
Appendix D: Recommendations by Mehmood-Ul-Hassan Khan
References
From the Paper "The best way to determine what the future might hold is to understand the past and the present, and add to that the changes seen by experts on the horizon. Therefore, constructing the history of Pakistani banking forms a major part of the current research; outlining contemporaneous changes and decisions regarding Pakistani banking made by its most senior officials is also important to understanding the influences on bank manager career tracks and attitudes. In addition, an extensive literature review of those factors that generally contribute t manager career orientation in any business will help understand the Pakistani bank managers' positions. Interviews with at least a few current Pakistani bank managers will display the attitudes they currently hold, and provide insight into what they expect in the future and what would make them more or less career-oriented."
Abstract This paper considers globalization and relationships at Lazard, an investmentbanking company. The international challenges faced by the company are looked at. The paper provides an overview of the investmentbanking industry and changes resulting from globalization. The paper looks at Lazard's operations and divisions. It includes charts.
From the Paper "For many years investment bankers remained outside of the media spotlight. Bankers were typically associated with large commercial and retail banks but investment bankers ..."
Tags: Lazard, international banking, globalization, porter, Bartlett & Ghoshal, Yip
Abstract This paper considers the globalization and relationships at Lazard, an investmentbanking company. It discusses Lazard's current role in the international market. The author addresses the question of whether investmentbanking is global or local.
From the Paper "For many years investment bankers remained outside of the media'spotlight. Bankers were typically associated with large commercial and retail banks but investment bankers were ..."
Tags: Lazard, international banking, globalization
Abstract Among the many investment vehicles offered by Charles Schwab on-line are mutual funds. A specific mutual funds program offered by Charles Schwab is the "One Source Online" program. This paper compares this program with similar programs offered by other companies. The writer discusses the aspects an investor would want to consider when choosing a company with which to invest.
From the Paper "A mutual fund is a particular type of investment company. Specifically, a mutual fund is an open-end investment company. An open-end investment company is one that does not have a fixed amount of capital stock, and continues to sell additional shares to the public as demand warrants. As an open-end investment company, a mutual fund also repurchases the outstanding shares in the fund when such shares are surrendered by shareholders. The term mutual indicates that the investment company represents a mutual pooling of the investment funds of a large number of people who share in the outcome of the combined investment of those funds. The value of a share in a mutual fund is determined by the market value of the investment holdings of the mutual fund."
Abstract This study examines the nature and effects of race and gender on managerial progression within the investmentbanking industry. It attempts to prove that race and gender have the potential to negatively impact a minority's ability to progress in the industry. Successful advancement opportunities, in theory, should be contingent upon an individual's skills, abilities and work history; unfortunately, time and time again, this theory has been disproved by statistical data, which indicates that race and gender do, in fact, impact on employees' potential for achievement. The study focuses on the managerial progression of candidates, both male and female, of minority and non-minority descent within the U.S. and the U.K. It also details the importance of developing more comprehensive recruiting and promotional activities targeted specifically toward these populations. The paper concludes that equality measures implemented thus far have not been efficient in attracting and promoting candidates.
Table of Contents
Abstract
List of Tables
List of Figures
Chapter I: Introduction
Problem Statement (or Purpose)
Significance of the Study
Assumptions
Limitations
Definitions (or Acronyms)
Chapter II: Review of Relevant Literature and Research
Chapter III: Research Methodology
Research Technique
Research Design
Survey Population
Sources of Data
The Data Gathering Instrument
Distribution Method
Reliability
Validity
Treatment of Data and Procedures
Chapter IV: Results
Chapter V: Discussion
Chapter VI: Conclusions
Chapter VII: Recommendations
Appendixes: Bibliography, Tables, Interview Questions
From the Paper "Research also reveals that at least within the United States, finding African American presence among the highest levels of responsibility at Wall Street firms including financial institutions and investment banks is not nearly as difficult in modern times as in historical times (McCoy, 1992). Black finance professionals have actually "built impressive track records with their own investment firms" (McCoy, 1992).
The good news however is tempered by statistics that reveal that in general there are still very few African-Americans and like minded minorities working in managerial positions overall within the nation's leading investment banks (McCoy, 1992). This is even truer for minority women, who often face double discrimination, being an ethnic minority and being a woman. Statistics also reveal that few black finance professionals are currently "coming through the pipeline" to help statistics (McCoy, 1992)."
Abstract In this paper the business lines in Bank of Montreal show an increasingly profitable growth margin in recent times. The writer shows that by realizing the revenues and assets of the bank one can see the new mission to make acquisitions on the international market as well as in commerce in the United States. Further, the writer points out that by pursing new avenues of investmentbanking the Bank of Montreal is expanding to suit the new global markets. The writer also notes that without this approach the bank would be missing an opportunity to expand exponentially into new market.
From the Paper "The aim of this financial study will help to understand the goals and objectives that the Bank of Montreal (BMO) possess in the near future. By realizing the investment potential through loan policy, profit margins, and the business division present within this bank, one can discern the growing capacity of generating capital through this banking institution. Also, one can evaluate the mission statement of the Bank of Montreal in regards to progressive monetary and financial goals for the bank's future."
Abstract This sixteen-page undergraduate paper is in the form of a report on three career options: Financial Planner, Investment Banker, and Credit Analyst. The report provides the knowledge to make an educated decision on which career option to start out in, and discusses the skills needed to be successful, including the work environment of each career option, the amount of advancement possibilities, salary and how it changes with experience, and the future growth or lack of growth in the career option.
Abstract The paper discusses the requirements for an individual to major in finance and succeed in this career. The paper outlines three lucrative careers open to finance majors, namely, financial analysts, financial consultants and working in commercial banking. The paper predicts that now is a good time to receive an education in finance, because by the time a student graduates, the current economic woes will likely have abated.
Outline:
Requirements for the Major
Finance Careers Outlook
From the Paper "To major in finance and succeed in finance as a career path requires more than a desire to simply 'make money'--it requires a genuine enthusiasm for working with people as well as numbers. Ideally, an employee with high aspirations in the finance industry will have a strong background in accounting combined with a personality that is "outgoing and inquisitive by nature" (Nich 2003). A good finance curriculum should provide a student with financial management tools "to succeed in analyzing and executing the financial aspects of managerial decisions" and the candidate's own charisma must convey to the client how certain decisions will enable the client to meet certain goals, using all of the realistic resources and options available."
Abstract This paper examines certain workplace issues of satisfaction, including job security, fair wage and salary levels, equitable distribution of benefits, training and career enhancement opportunities that integrate to create an environment that fosters both motivation and high performance and attempts through that to maximize productivity. The purpose of this research is to review the psychology behind the factors that contribute to employee stress as a result of organizational change, environmental and economic factors. The author attempts to analyze these concepts and examine how they contribute to worker's stress levels, thereby revealing the type of training and coping skills that organization's can attempt to provide. This paper addresses this problem specifically in the investmentbanking industry, with reference to the firm of Goldman Sachs. The author looks at the the financial services industry that has been characterized by ongoing and ever-increasing merger and acquisition activity and expansion with focus on change in technology, organizational settings, workforce and management. The author investigates how these changes may effect employee anxiety and stress levels with focus on the causes of stress and their possible psychological and physiological effects. The author provides recommendations as to how to achieve economies of scale and efficiencies through innovation and welcoming of change that is planned and appropriately dealt with and how to deal with the possible stress that may emerge through training, leadership, support, work teams, increased employee decision making and involvement, communication, change in reward systems and enforcement of a culture of change, innovation and challenge.
From the Paper "While the profitability of corporations is typically measured in dollars, overall success can be measured in terms of profitability plus the attainment of organizational goals. This success derives from a synergy of inputs, including the work of employees who are dedicated, skilled and knowledgeable, and a management team that understands how to inspire competent and motivated performance through sensitive and responsive management of a continually changing workplace. The cost of socially-responsible management is an investment: the workplace environment directly impacts the motivation and productivity of the workforce. Simply put: happy, secure workers are productive workers. Companies are responsible for creating and maintaining a positive and supportive workplace environment through ethically responsible policies, fair compensation and proactive management. While not quantifiable as a line item, an attitude of responsibility to workers and to the workplace environment has a noticeable effect on the corporate bottom line. According to Alan Reder in his book In Pursuit of Principle and Profit (1994), responsible policies ensure that every quality of a company will emerge over time and greatly increase a company's chances of long-term success. Workplace issues of employee satisfaction include job security, fair wage and salary levels, equitable distribution of benefits, training and career enhancement opportunities that integrate to create an environment that fosters motivation, high performance and maximized productivity."
