What Is The Duty Of An Investment Bank In Our Financial System?
The primary function of investment banks in our economy is to help move capital to where it is needed the most. For example, investment banks lend out significant sums of money to entrepreneurs to start businesses. Another example is that investment banks provide loans and mortgages for businesses to purchase new equipment and facilities. Without these source of loans entrepreneurs and businesses would not be able to start new companies and expand existing ones. Thus, investment banks are a vital part in helping to move capital to the people that need it to grow their business and ultimately our economy.
Investment banks also do another crucial task for companies. They often act as intermediaries or mediators when two companies are planning on going through a merger or one company acquires another one. The investment bank in this case, ensures that both sides get a fair deal and that the entire transition is done smoothly with minimal disruptions. Without investment banks acting as intermediaries for firms, mergers and acquisitions would take a very long time, would be disruptive to employees and cost a lot more.
The word investment is found within the name of an investment bank. True to their name, investment banks will invest their own money and resources into ventures. They can invest by purchasing stakes in companies or assuming ownership. When ownership is assumed, an investment bank may take over the management of a company or appoint their own team. They can of course keep the current board of directors and simply take a share of profits. Investing directly into companies through shares and stakes is one way that startups gain access to much needed capital.
The Story Of Investment Banker Martin Lustgarten
Martin Lustgarten is an Austrian native who runs investment banking company, Lustgarten Martin. The firm is named after himself and contains his family name followed by his first name in opposite order. Lustgarten Martin focuses on niche markets in Latin America.
Mr. Martin Lustgarten has lived in and transacted in numerous business deals in Venzeuela. He is multilingual, being able to speak German, English and Spanish. Martin currently resides in Florida, where he enjoys being a husband and father to his children. He is also an avid collector of rare vintage items such as luxury watches.