Investment bank is a financial institution that acts as a financial intermediary for governments and businesses by helping them raise funds, trading related services, M&A, Research and many more such services.
IB usually split into three sections
- Front office
- Middle office
- Back office
Front office– It tries to onboard new clients and tries to extract more business from existing clients to generate meaningful business for the IB
Example: JP Morgan acquired reliance as their new client so now the BO team will do the AML and KYC checks and open their account. The client details will be captured in the Reference data management(RDM) and Metadata management(MDM) system.
Advertisementsabout:blankREPORT THIS AD
Middle office: After the front office has onboarded new business from new or existing clients, MO provides a support function to the FO and BO by processing those deals.
Responsibilities of MO
- Risk management- Analyzing the risk involved in the deals which FO has entered into
- Compliance work- Compliance check on employees so that they do not breach the company’s rules
- Calculating commissions, taxes, P&L and financial reporting
- Internal audit- To refrain from any regulatory sanctions
- Legal work- Deals with legal issues that arise with clients or the organization itself
Back office- After the front office has onboarded new business from new or existing clients, BO will do the AML and KYC checks and open their accounts. The client details will be captured in the Reference data management(RDM) and Metadata management(MDM) system.
BO provides support activities like
Transaction processing- settlement and reconciliation
Client onboarding- AML/KYC
HR activities- Payrolls, employee details
IT- RDM/ MDM/ MIS(Management Information System)
In Investment bank every part makes an important contribution
Peepalfarm. 