Economic & Financial Environment of Business case study 2 files needed

User Generated

cvaxl0101

Economics

Wilmington University

Description

2 files needed
a. One Word file
b. One Excel file

Identify one of the top ten investments banks as of 2018.

2. Provide a concise description of the bank’s core competency with examples of recent activities or transactions. Be sure to provide specific $ data on the magnitude of the bank’s recent activities.

3. How has the size of your selected investment bank changed in the last decade? Use $ valuations to illustrate the change. In which investment bank functions did their overall business increase and/or decrease?

4. Prepare a balance sheet analysis of the bank, comparing 2007 B/S $ values to the most recently published B/S (either 2017 or 2018). Be sure to include the following items, in Excel spreadsheet format:

a. % change in total assets, liabilities, and equity positions over this period

b. Past and current leverage position of the investment bank, and % change over this period

c. Comparison of book to market value of the bank, 2007 to current value

5. Refer to the following short article and address the question in detail:

a. Article: Edelmann, C., & Hunt, P. (2017). How the Great Recession Changed Banking. Harvard Business Review Digital Articles, 2–9

b. Question: Compare the financial analysis completed in item #3 above to the main points in the article, including changes in B/S valuation.

Answer the following questions for a fictitious public offering, and show all calculations:

An investment bank offers underwrites an IPO of up to 18.5m shares for ABC Company at a price of $12.50 per share. Show the $ return to the investment bank under both scenarios:

1. The 18.5m shares sell at $13.25 per share.

2. What happens if the IPO price is overstated and the shares sell for $12.25 per share?


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MBA 6400 Case 2 Investment Banking U.S.-based investment banks have undergone what many would consider substantive changes in the last eleven years, over the period 2007 to 2018. This period coincides with the Great Recession, which was a significant driver of changes to investment bank business and characteristics. Such changes include wider fluctuations in mergers and acquisitions, reduced initial public offering underwriting, reductions in staffing, and associated impact on investment bank balance sheets. For this case study, address the following items: 1. Identify one of the top ten investments banks as of 2018. 2. Provide a concise description of the bank’s core competency with examples of recent activities or transactions. Be sure to provide specific $ data on the magnitude of the bank’s recent activities. 3. How has the size of your selected investment bank changed in the last decade? Use $ valuations to illustrate the change. In which investment bank functions did their overall business increase and/or decrease? 4. Prepare a balance sheet analysis of the bank, comparing 2007 B/S $ values to the most recently published B/S (either 2017 or 2018). Be sure to include the following items, in Excel spreadsheet format: a. % change in total assets, liabilities, and equity positions over this period b. Past and current leverage position of the investment bank, and % change over this period c. Comparison of book to market value of the bank, 2007 to current value 5. Refer to the following short article and address the question in detail: a. Article: Edelmann, C., & Hunt, P. (2017). How the Great Recession Changed Banking. Harvard Business Review Digital Articles, 2–9 b. Question: Compare the financial analysis completed in item #3 above to the main points in the article, including changes in B/S valuation. Answer the following questions for a fictitious public offering, and show all calculations: An investment bank offers underwrites an IPO of up to 18.5m shares for ABC Company at a price of $12.50 per share. Show the $ return to the investment bank under both scenarios: 1. The 18.5m shares sell at $13.25 per share. 2. What happens if the IPO price is overstated and the shares sell for $12.25 per share?
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Explanation & Answer

Attached.

Bank of America

Bank of America
Balance Sheet
Years ended 2018-31-12 and 2007-31-12
Annual Data (Millions of US $ except per share data)
Period Ending
2007-31-12
Cash on Hand
345,920
Notes and Loans Receivable
899,180
Inventory
Other Current Assets
Total Current Assets
1,245,100
Property, Plant and Equipment
11,240
Long-term Investments
214,056
Goodwill and Intangible Assets
91,173
Other Long-term Assets
154,177
Total Long-Term Assets
470,646
Total Assets
1,715,746
Total Current Liabilities
1,249,012
Long Term Debt
197,508
Other Non-Current Liabilities
22,423
Total Long-Term Liabilities
219,931
Total Liabilities
1,324,465
Common Stock Net
60,328
Retained Earnings (Accumulated Deficit)
81,393
Comprehensive Income
1,129
Other Share Holders Equity
-456
Share Holder Equity
146,803
Total Liabilities and Share Holders Equity
1,715,746

2018-31-12
660,377
1,013,475
1,...


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