Consideration On The Development Of China's Investment Banking

Investment banking, which connects corporations with corporations, and investors with raisers, is a kind of financial industry with intense intelligence. And investment banks are not only highly developed intermediary organs hi economic activities, but also important and participant. They are becoming more and more important, and have no substitutes in the case of financial global integration. After development for over a hundred years, the investment banks hi the informational capital market are highly experienced and they have had various modes, which bear both similarity and peculiar features due to different historical conditions. We can get a lot from their development courses, their experience and lessons, and their general trends.Judged by the developing tendency of the investment banking abroad, the investment banking hi China in the future is to establish the modern service scope which involves underwriting, financial consultation, merger and acquisition, asset management, floatation of load and corporation finance. However, the investment banks hi China have many service defects, which makes them bear the features of "primary investment banks". The defects are: the key services such as the services concerning merger and acquisition are not adequate, they are short of experience with respect to the instruction and evaluation of the corporate development strategy. So they have no way to give consultation to corporate about the correlation and conformity of the acquisition and that whether the added profit and cash debit are higher than the cost of the merger and acquisition. So the investment banks should try to make full use of their advantages of net world, technology, personnel, market, information and makes full use of advantages hi competition, thus making right development orientation with the global integration and specialization of the investment banks.Moreover, after China entry into WTO, the competition is not only among the domestic investment banks, but also between domestic banks and the distinguished international banks. Therefore, we should try to establish and optimize the operation system of the securities market in strict accordance with the regulations of WTO, take the initiative to take part in the international competition with the domestic securitiesmarket after its opening and participate in the competition in the international market. Only in this way can the domestic investment banks get adapted to the economy globalization. This is the right strategically choice for them to face the opening to outside world.This paper has made deep research on the development of the investment banks due to consideration on them. In the paper, the research is given successively in both positive and normative analysis, from generalization to particularity. The author has analyzed the investment banking throughout the world to that in the capital market in China. The paper gives orientation to the development and the investment banks in China and then suggests the development strategies of them in the 21 century. The creative point in the paper consists in systematic analysis of the investment banking by means of the theories of the institutional economics and the industrial organization as well as the suggestion to establish principal bankers as the fundamental strategy in the development of the investment banks in China.The paper is divided into four chapters.The first chapter is the brief introduction to the investment banks. It first gives the definition of it by the famous economist Kuhn, then the definition of the author. At last, it talks about the classification, properties and the economic theoretical analysis of the investment banks.Chapter two focuses on the investment banking abroad, its development, its services throughout the world and what we can learn from it.Chapter three involves the capital market and investment banking in China. It first analyzes the development of the capital market in China and the problems it faces, and the investment banking and it...