Is Corporate Finance a Division of Investment Banking?

Investment banking and corporate finance are closely related terms. Corporate finance is an area of finance that deals with financial decisions that corporations make and the tools used to make these decisions. Investment banking is a term for corporate finance services that investment banks provide to its corporate clients. While corporate finance services aren't exclusive to investment banks, they are important part of investment bank's day-to-day operations

Corporate Finance and Investment Banks

Investment banks can provide a variety of corporate finance services for their clients. This includes:

• Raising funds - investment banks can help companies raise money for current and future operations by investing some of their existing capital in stocks and securities. Since this involves putting lots of money on the line, they carefully examine all their options.

• Managing existing resources - investment banks will look at the existing financial operations and find ways to make them more efficient. If the company has any debt, they will work toward eliminating it, and making sure their clients will not fall into the same debt circumstances.

• Mergers and Acquisitions - investment banks will advise their clients on how to best manage a merger or acquire another company. It is very important for a company to know how to incorporate a new acquisition into their own corporate structure, and that is what mergers and acquisitions exams closely. Among other things, this involves negotiating with bidders, examining contracts and negotiating merger targets.