| Investment banks are financial agent organizations actively involved in capital market, majoring in securities consignment, direct placement, including Securities Company, fund management company, financial capital management company, securities investment consulting company and other finance related organization. This paper analyzes the function and efficiency of Chinese investment banks in the social economic development from the standpoint of the status quo of Chinese investment banks and financial market and points out that Chinese investment banks' solution lies in that they have not executed their own financial function well. The function of investment banks has experienced a period from simpleness to complexity during the past two hundred years, therefore, during the course of fostering modern investment banks, it is necessary to the late-development countries to take use of developed-countries' successful experience by exposing investment banks' modern function, and then use late-development advantage, seek and execute the integrated financial function. Efficiency is the key reflection of financial function, but traditional analysis of efficiency can not cover investment banks' financial function in modern economy. Therefore, it is necessary to expand the study from simple efficiency analysis to complex efficiency system study. Under the background of market economy, the high executive efficiency of investment banks' financial function needs a perfect credit system which includes two parts, the public credit and the private credit, to support itself. Thus, the discussion of credit system's development is very important during the transition economy, not only to the theory, but also the practice.The main innovation of the paper lies in: (1) It proposed "4+1 financial functions tie" of the investment banks in China. Financial market is the key to influence the distribution of the economic resources, while the investment bank is the core intermediary of the financial market. In the ideal economic and financial circumstance, investment banks display their functions, such as financing intermediary, information intermediary, distribution intermediary, fortune intermediary. The development of social division, economy financialization and finance securitilization, promotes the evolvement of investment banks. In the transition economy, investment banks also have the function of fostering financial market. The display of "4+1 financial functions tie" of the investment bank has the special significance to a young developing nation. The paper systematically analyzes "4+1 financial functions tie" of the investment banks in China and explores deeply on how to play the function and mechanism well in the distribution of the resources. Now China social economy is transforming in great need of specific financial service while the system reform is largely lag behind. Under this background, it is important to make these new investment banks' achieve the leap-forward development.(2) The paper builds a "Diamond-efficiency portfolio". Investment banks can be considered as a sort of multi-dimensioned multi-leveled economic efficiency and the measurement of the executive situation of financial functions. Because of modern investment banks' complication, Nero-classical economics' definition on efficiency can not explain the functional aims including these macro-factors. Based on that, the author breakthroughs the usual micro-leveled study on "efficiency" from Nero-classical economics' and extends the implication of "efficiency". It uses the multi-dimensioned and multi-leveled method analyzing and inspecting the efficiency system of the investment bank, as well as proposes "Diamond-efficiency portfolio" tentative plan, and from exterior, intrinsic and dynamic angle, explores thoroughly on the efficiency of investment bank in China. It raises the implication of "efficiency" from the microscopic level to a systematic level, thus provides a strong explanation to the present situation and the tendency of the investment banks in China.(3) The paper brings forward the conception of investment bankers and the "dual-credit" system. Investment bankers are carriers of financial functions and promotion of financial efficiency. If it is necessary to achieve the financial functions tie, the "dual-credit" system, including the private credit of investment bankers, is required. In allusion to the distortion of current credit system, the paper, from the time-dimensioned, analyzes investment bankers' function and efficiency and reviews the function and efficiency of investment banks thoroughly from time scale, and also explores the "dual-credit" system and its function from the structure of the basic credit system. The analysis shows that what baffles the investment bank is the distortion of credit system. Based on these analyses, this paper makes an academic research on the rules in the investment bank to keep the sustainable high-efficient condition through rectifying the distortion.In sum, with the development of economy, the financial function and efficiency of investment banks are getting more complicated. If the Chinese investment banks exercise the "4+1 financial functions ", it will show its vitality during the transitional economy relied on the later-developing advantage. Acting as the standard of financial function, financial efficiency can be developed as "Diamond-efficiency portfolio", and analyzes comprehensively the present situation of investment bank, then, promotes some counter-policies. Building the "dual-credit" system, also constituting exterior and interior institution, will accelerate Chinese investment banks' regression of financial function and promotion of financial efficiency, and also facilitate the operation of Chinese economic and financial systems.
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