What is the Investment Banking Division (IBD)?
The Investment Banking Division of the larger investment bank is referred to as IBD. IBD is in charge of carrying out capital raising (underwriting in stock, debt, and hybrid markets), mergers and acquisitions, as well as numerous advising tasks, in collaboration with businesses, institutions, and governments.
Other Divisions of an Investment Bank
The Investment Banking Division (IBD) and other parts of an investment bank have distinct boundaries. Examples include:
- Equity research
- Sales and trading
- Commercial banking
- Asset management
- Retail banking, and other areas
All of the aforementioned positions are categorised as “front office” vocations (think: client-facing). Aside from front office positions, investment banks also provide “middle office” positions in areas like operations, technology, and human resources. In addition, there are “back office” employment in areas like payroll, computer support, and accounting.
Not Everyone Who Works at an Investment Bank is an Investment Banker
Although people frequently claim to work in investment banking when they actually don’t, when someone says they “work in investment banking,” they should be referring to the IBD inside an investment bank.
Because of this, real investment bankers are upfront about the fact that they are IBD professionals.
Not all employees at investment banks are investment bankers.
Launch our investment banking courses to find out more about the talents needed in the division of investment banking!
Industry Groups With IBD
The IBD is further subdivided into industry groups. The most common groups are:
- Technology Media & Telecommunication (TMT)
- Financial Institutions Group (FIG)
- Energy
- Mining
- Healthcare
- Industrials
- Real Estate
Job Titles in the Investment Banking Division (IBD)
There is a standard hierarchy within the IBD that’s nearly the same at most banks. The titles and career path at most banks are as follows:
- Analyst – focused exclusively on financial modeling, valuation work, and pitch book support
- Associate – manages the Analysts, also does modeling and drafts pitch books
- Vice President – manages Associates, designs pitch books, goes to client meetings
- Director – meets with clients, structures deals, leads the team
- Managing Director – focused almost exclusively on winning new business/clients
To learn about compensation at each level check out our investment banking salary guide.
Additional Resources
This has been the CFI’s guide to the organisational structure of investment banks, which should help clarify what it really means to work in the IBD. We highly recommend the following supplementary sites to help you learn more and advance your career:
- What Do Investment Bankers Do?
- Investment Banking Interview Questions
- Equity Research vs Investment Banking
- Financial Modeling Guide
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