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Investment Bank-what does it do? An investment bank (IB) isa financial intermediary that performs a variety of services such as. underwriting, acting as. an intermediary between a securities issuer and the investing public, facilitating mergers and other corporate reorganizations. The 4 main functions of Investment Bank are:- - Valuing and underwriting new stock issues (IPO, FPO & rights) - Valuing and underwriting Bonds for corporates and government - Assisting in merger and acquisition - Financial Advisory and research services- Analysts’ reports and recommendations. Additional services include asset management and wealth management for large investment funds. Clients of investment Banks are Corporations, pension funds, Governments, Hedge funds and other financial institutions. Underwriting are of two types:- 1. Underwritten Offering- tn this type of underwriting, Investment Bank buys securities from the issuer at a price negotiated, thus guaranteeing that issuer gets the amount of capital it requires. The bank takes more risk in this process,. If all the shares are not subscribed, then the bank is bound te subscribe the unsubscribed shares. 2. Best Efforts Offering- Here, Investment bank merely acts like a broker and doesn't assume risk associated with buying of securities, If the offering is unsubseribed, the issuer will sell fewer securities and the bank has not obligation to buy the unsubscribed. Generally, in 1POs where underwritten offering takes place, more than two investment banks participate in the process to reduce the risk. Part of Investment bank's job is to evaluate the company and determine a ‘reasonable price’ at which shares are issued. In M&A, Investment Banks evaluate the worth of a possible acquisition and arrive at a fair price. Financial Advisory roles include, advising corporations in IPO, raising new capital through alternative means (Like Private equity, private placement, QiPs, etc) and advising on all aspects of finance, 
