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Investment Banks (investment + bank)
Selected AbstractsThe Education Lending Policy of the European Investment BankEUROPEAN JOURNAL OF EDUCATION, Issue 1 2009ALBERT TUIJNMAN The purpose of this article is to present the latest Education Lending Policy (ELP) of the European Investment Bank (EIB), adopted by the Board of Governors in 2008. It is structured in two parts. The first briefly presents the EIB in general and the evolution of its education lending portfolio in particular. This sets the stage for the second part of the article, which reproduces the Bank's new ELP , only the second such formal education sector policy statement adopted by the institution to date. [source] AFRICA: Investment Bank CreatedAFRICA RESEARCH BULLETIN: ECONOMIC, FINANCIAL AND TECHNICAL SERIES, Issue 12 2010Article first published online: 9 FEB 2010 No abstract is available for this article. [source] Situating Global Capitalisms: A View from Wall Street Investment BanksCULTURAL ANTHROPOLOGY, Issue 1 2005Karen Ho The project of conceptualizing powerful subjects and intervening against Wall Street investment banks' hegemonic claims is thwarted by social scientific norms of approaching late capitalism and globalization. Overarching scripts of capitalist globalization not only prevent understanding the heterogeneous and complicated particularities of Wall Street's approaches to the global but also ironically parallel the marketing schemes and hyped representations of Wall Street capitalist promoters. Drawing from in-depth fieldwork with investment bankers, this article portrays Wall Street's uses and understandings of the global and the contingencies and contexts of its global imaginings. It demonstrates that even for the most seemingly globalized and powerful of actors, global ambitions can implode and generate internal contradictions. [source] Bookbuidling, Auctions, and the Future of the IPO ProcessJOURNAL OF APPLIED CORPORATE FINANCE, Issue 1 2005William J. Wilhelm Jr. Auction theorists predict that bookbuilding, long the standard process for selling equity IPOs in the U.S., is about to give way to an Internet-based IPO auction process that is both more efficient and more fair. The promise of auctions is that, by using an electronic platform that gives all investors the opportunity to bid on IPOs, the underpricing of IPOs and commissions to underwriters will be reduced, leading to an increase in net proceeds to issuers. Largely missing from such arguments, however, is an appreciation of why bookbuilding has dominated U.S. practice (and continues to supplant auctions in IPOs in most countries outside the U.S) and the role of undepricing in the IPO process. Rather than canvassing all investors, bookbuilding involves eliciting expressions of interest from institutional investors, and then allocating shares mainly according to the strength of their professed interest. In contrast to auctions, which allocate shares according to a set of explicit rules, bookbuilding involves a set of implicit "rules" that provide considerable room for judgment by the underwriter. This does not mean that the rules are arbitrary or not well understood by participants, particularly after thousands of IPOs conducted over the better part of two centuries. But to manage the exchange of information between issuers and investors, and the potential conflicts of interest in representing both groups, such rules must be administered by an intermediary with a considerable stake in protecting its reputation for fair dealing. Investment banks that deal with both issuers and the investment community on a regular basis are well positioned to perform this function. The underpricing of IPOs is best viewed not as a transfer of wealth from issuers to favored investors but rather as compensation to the large influential investors that play a major role in the price discovery process. By opening the process to all comers, auctions will discourage these large investors from bidding aggressively because less sophisticated investors will be able to "free ride" on their research and due diligence. To the extent this happens, auctions may suc ceed in reducing underpricing (in fact, they may even lead to over pricing), but they will also reduce the net proceeds for issuers. Nevertheless, recent advances in communications technology and auction theory will undoubtedly reshape current securities underwriting practices. In particular, Internet auctions are likely to replace bookbuilding in debt IPOs and less risky equity issues (say, IPOs of LBOs). But the argument that Bookbuilding will be completely cast aside in favor of largely untested alternatives fails to appreciate a successful institutional response to major market imperfections, some of which can never be wholly eliminated. Especially in the case of risky (first-time) equity IPOs, there will continue to be an important role for managing the information exchange between issuers and investors that is critical to the IPO process. [source] Impact of Visibility and Investment Advisor Credibility on the Valuation Effects of High-Tech Cross-Border AcquisitionsFINANCIAL MANAGEMENT, Issue 1 2007Georgina Benou Since foreign high-tech firms exhibit a high level of asymmetric information, there is much investor skepticism surrounding the potential benefits to US firms that acquire them. However, the investor perception may be more favorable when the acquisitions involve more visible targets and advice from investment banks with a strong reputation. Based on a sample of 503 high-tech cross-border acquisitions, bidding-firm shareholders experience positive but statistically insignificant valuation effects overall. However, bidder firms experience positive and significant valuation effects when the foreign high-tech target receives a high level of media attention and when the acquisition is endorsed by a top-tier investment bank. Visibility and credibility enhance the perceived benefits of acquiring foreign targets that have substantial intangible assets and a high level of asymmetric information. [source] A Parimutuel Market Microstructure for Contingent ClaimsEUROPEAN FINANCIAL MANAGEMENT, Issue 1 2005Jeffrey Lange G10; G13; G14 Abstract Parimutuel principles are widely used as an alternative to fixed odds gambling in which a bookmaker acts as a dealer by quoting fixed rates of return on specified wagers. A parimutuel game is conducted as a call auction in which odds are allowed to fluctuate during the betting period until the betting period is closed or the auction ,called'. The prices or odds of wagers are set based upon the relative amounts wagered on each risky outcome. In financial microstructure terms, trading under parimutuel principles is characterised by (1) call auction, non-continuous trading; (2) riskless funding of claim payouts using the amounts paid for all of the claims during the auction; (3) special equilibrium pricing conditions requiring the relative prices of contingent claims equal the relative aggregate amounts wagered on such claims; (4) endogenous determination of unique state prices; and (5) higher efficiency. Recently, a number of large investment banks have adopted a parimutuel mechanism for offering contingent claims on various economic indices, such as the US Nonfarm payroll report and Eurozone Harmonised inflation. Our paper shows how the market microstructure incorporating parimutuel principles for contingent claims which allows for notional transactions, limit orders, and bundling of claims across states is constructed. We prove the existence of a unique price equilibrium for such a market and suggest an algorithm for computing the equilibrium. We also suggest that for a broad class of contingent claims, that the parimutuel microstructure recently deployed offers many advantages over the dominant dealer and exchange continuous time mechanisms. [source] Impact of Visibility and Investment Advisor Credibility on the Valuation Effects of High-Tech Cross-Border AcquisitionsFINANCIAL MANAGEMENT, Issue 1 2007Georgina Benou Since foreign high-tech firms exhibit a high level of asymmetric information, there is much investor skepticism surrounding the potential benefits to US firms that acquire them. However, the investor perception may be more favorable when the acquisitions involve more visible targets and advice from investment banks with a strong reputation. Based on a sample of 503 high-tech cross-border acquisitions, bidding-firm shareholders experience positive but statistically insignificant valuation effects overall. However, bidder firms experience positive and significant valuation effects when the foreign high-tech target receives a high level of media attention and when the acquisition is endorsed by a top-tier investment bank. Visibility and credibility enhance the perceived benefits of acquiring foreign targets that have substantial intangible assets and a high level of asymmetric information. [source] A Comparison of Syndicated Loan Pricing at Investment and Commercial BanksFINANCIAL MANAGEMENT, Issue 4 2006Maretno Harjoto We reject the hypothesis that investment and commercial banks have identical loan-pricing policies. We find that compared to commercial banks, investment banks lend to less profitable, more lever aged firms, price riskier classes of term loans more generously, and offer relatively longer-term credits, usually with term, not commitment contracts. Investment banks typically establish higher credit spreads, although the premium declines when a commercial bank joins as syndicate co-arranger. Investment banks also price riskier classes of term loans more generously to borrowers than do commercial banks. Commercial-bank funding advantages do not appear to be a source of the pricing differences. [source] Capital Culture Revisited: Sex, Testosterone and the CityINTERNATIONAL JOURNAL OF URBAN AND REGIONAL RESEARCH, Issue 3 2010LINDA McDOWELL Abstract In this essay I want to revisit and add to the arguments in my book Capital Culture: Gender at Work in the City, published a decade before the first signs of the current financial crisis. There I suggested that the City of London, the financial heart of the UK, is an arena riven by sexualized and gendered scripts: in other words capitalism is gendered. A decade or so later, these arguments seem just as relevant as the financial ,masters of the universe' are brought low, in part by their own behaviour. Here, I explore more explicitly the implications of testosterone-fuelled risk taking by both the traders and the chief executive officers of investment banks in the current world of casino capitalism. Résumé Ce travail reprend et complète le propos de Capital Culture: Gender at Work in the City, le livre que j'ai publié une décennie avant l'apparition des premiers signes de la crise financière actuelle. Cet ouvrage préconisait que la City de Londres, c,ur financier du Royaume-Uni, était une arène scindée selon des scénarios différenciés par sexe et genre, autrement dit le capitalisme était sexué. Près de dix ans plus tard, ces propos semblent tout aussi pertinents d'autant que les ,maîtres de l'univers' de la finance sont amoindris, en partie à cause de leur propre comportement. Sont examinées ici de plus près les implications des prises de risques nourries à la testostérone auxquelles se livrent à la fois les traders et les directeurs généraux des banques d'investissement dans un monde où règne un capitalisme de casino. [source] TRANSFERABLE STOCK OPTIONS (TSOS) AND THE COMING REVOLUTION IN EQUITY-BASED PAYJOURNAL OF APPLIED CORPORATE FINANCE, Issue 1 2004Brian J. Hall The dominant form of equity pay in the U.S. will change dramatically when accounting rules are changed (most likely in 2005) to require companies to charge the cost of their stock option plans on their income statements. Many companies are already switching from stock options to other forms of equity pay, especially restricted stock. The most notable switcher was Microsoft, the world's largest user of stock option pay. In July 2003, partnering with J.P. Morgan, Microsoft created a onetime transferable stock option (TSO) program that allowed holders of underwater Microsoft options to sell their options to J.P. Morgan in return for restricted shares. But the most important consequence of this transaction may not be a widespread shift by corporate America to restricted shares, but rather the creation of a more costeffective kind of stock option. By clearing the potentially messy hurdles involving taxes, accounting, SEC rules, and "transaction mechanics," Microsoft has opened the door for TSOs to be considered as an ongoing equitypay instrument, perhaps replacing standard stock options (which are not transferable). TSOs share the key advantages of restricted stock in terms of providing robust retention and ownership incentives and higher valuecost efficiency, while maintaining the key "leverage" advantage of options. In so doing, they create significant upside (and downside) while largely avoiding the "pay for pulse" problem of restricted stock. They also introduce the discipline of competitive pricing by third-party bidders. The bid prices of investment banks create nearly all of the information required for accurate estimates of option cost, which should foster greater board accountability and improved corporate governance. [source] An Examination of the Equity Market Response to The Gramm-Leach-Bliley Act Across Commercial Banking, Investment Banking, and Insurance FirmsJOURNAL OF BUSINESS FINANCE & ACCOUNTING, Issue 9-10 2006H. Semih Yildirim Abstract:, This paper examines the wealth effects of the events surrounding the passage of the Gramm-Leach-Bliley Act of 1999 and changes in systematic risk from the pre-Act period to the post-Act period for commercial banks, investment banks, and insurance firms. The results suggest that investment banks and insurance firms are better positioned to exploit the benefits of product-line diversification opportunities allowed by the legislation compared to commercial banks that experience no significant market reaction. Further evidence indicates a significant risk shift and overall reduction in riskiness for the financial sectors under consideration around the event period. [source] Impact of Government Ownership on Investment Banks' Underwriting Performance: Evidence from China,ASIA-PACIFIC JOURNAL OF FINANCIAL STUDIES, Issue 2 2010Ning Jia G21; G24; G28 Abstract This paper examines the effect of government ownership on investment banks' underwriting performance in China. A large number of Chinese investment banks are owned and controlled by their respective regional governments. While regional governments may capitalize on their superior local knowledge and administrative power to help affiliated investment banks identify and land high quality local issuers, they may also leverage affiliated underwriters to facilitate the capital market access of those underperformed but socially and/or politically desirable local firms. Empirical evidence favors the latter hypothesis. Specifically, using a sample of regional IPOs, we find that issuers underwritten by their respective regional government-affiliated investment banks exhibit lower earnings quality and poorer long-term performance compared with those underwritten by unaffiliated investment banks. However, this difference is attenuated after the abolition of the IPO quota system. Examination of underwriting fees and issuers' shareholder identity provides additional evidence supporting the latter hypothesis. [source] | |||||||||||||||||||||||||