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Is the golden era of investment banking over?

Created by : Puneet Gupta, Executive Planning, Alpla India Pvt. Ltd  | 06 17 2010 16:48:36 +0000
Keywords : is the golden era of investment banking over?
Activity:  362 views;  last activity : 07 26 2010 12:37:53 +0000
 
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There is one famous quote by someone “ALL that mankind has ever learnt is nothing more than a handful of seeds thrown on the field growing into green forests or gardens.” Thing is these famous institutions where greatest brains r said to work r so fragile, all their doom is caused by a single factor i.e Realty Prices dampening. Where all these people talk abt Risk Management, Hedging, Arbitrage were doing all these days. Disbursing 100% Loans for an asset class, so (where does one see any interest of a buyer in the property). Had the prices gone up he cud sell off n clear the mortgage loan. Moreover they took these mortgages and made them into instrument that cud be sold amongst investors. And again the left overs of subprime mortgaged were dumped into some naive foreign countries. So, all their exposure was based on ONE ASSET CLASS, THEY DISBURSED THE LOANS AND AGAIN THRU THEIR OWN ASSET MGMT CO.S DEVISED PRODUCTS TO SELL THESE BOGUS INSTRUMENTS. Offcourse some wil say its easy to curse now after the fallout. But these so called great institutions who advise Investors across the globe, who recommend securities to be bought and sold, technical analysis n all complex stuff appear naked. Now, wht if the realty price moved up in US. THe buyer wud have made some money, by putting none. By all means they shud hav set a limit to wht extent they will repackage a loan. Its baffling to see the doom in Americas most cherished financial institutes. They ignored some basic rules. As a gen rule Banks in India disburse loans upto 75-80% for any asset or as loan. Thanks to RBI patronage, these banks r not yet allowed to set shop in India, which they r asking for. Recently RBI again extended or questioned the deadline which was 2009, when RBI was to open n allow foreign banks to operate in India.
By Puneet Gupta, Executive Planning, Alpla India Pvt. Ltd  06 17 2010 16:48:36 +0000
 
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Puneet It looks like a question.. No description for the topic from your side. Although I agree with your argument.

But if it is a question then i don't think that investment banking lost his importance. How much % of population know about the risk management, hedging, Arbitrage etc etc.. Banking and investment banking both are in growing mode in India. Yes, we can say that awareness among people increased than past. But overall investment banking growth (%) is increased. Due to competition we can say that profitable margin is limited but the interest among people increased. Which helps all financial companies to make increment in the number of customers. Again overall profitability..... And i think in India more opportunities in the sector are still pending .......
By Vipin Bhasin, Private Equity/Hedge Fund/VC-Manager, Indian Investment Co.  06 18 2010 14:31:39 +0000
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Yes today instead of investment banking people prefer venture capitalist. The biggest disadvantage is the price. Many times the contrast in interests is also a big disadvantage.

So it started losing its importance ....... 
By Suganthi Srinivasan, Accounts Manager, Verizon Communications  | 06 18 2010 11:26:22 +0000
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Were there any Golden Era for Investment Bankers here ? If so, the era is over in India.

In India, mainly for regulation/s imposed by RBI, Investment Bankers could not play their negative role ( with big brains .. high salaries ? ) as they could do in the USA.

........  details awated
By ASOKE KUSARI, Domestic Private Banking-Executive/Manager, A large leading PSU Bank - India  | 06 17 2010 18:19:44 +0000
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The awareness towards investment banking in India has increased in the past few years before that it was an alien concept. However inspite of its potential negative effects RBI has managed it well. In my opinion there is ample scope for growth for investment banking

 
By Satadru Shastri, Partner, Mukherjee & Shastri  | 06 26 2010 15:17:47 +0000
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banking can never stop, sherlocks run the economy of world. ways may change but the cycle goes on.
By PRITHVI RAJ DUBEY, Managing Director, RAJ ENGINEERING INDUSTRIES PVT LTD  | 06 22 2010 10:57:14 +0000
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Till now all investment bankers firms(MF, INSURANCE, STOCK Brokers was looting the people. and so knowing there intentions people wer why of this but now as there are stricter norms, regulator and ombudsman in all fields people will somewhat be more risk-taking. So we can say that this is no the end of Investment banking and also there are only <10% increase in demat accounts cmapred to increase in MOBILE connections in India.

Zohar 
By ZOHAR BATTERYWALA, Relationship Manager, TAJ INVESTMENT  | 06 17 2010 17:11:37 +0000
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