Benefits and disadvantages of bank holding companies

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Reference no: EM133115373

References: Investment Banks, Hedge Funds and Private Equity, 3rd Edition (David P. Stowell)

Investment Banking in 2008 (B): A Brave New World

1. Why did stand-alone investment banks' management teams feel they needed to take on increasing amounts of leverage from roughly 2000-2008, and what might this have to do with the repeal of Glass-Steagal?

2. What incentives did the pre-2008 compensation structures in the investment banking industry potentially give to traders, bankers and senior management, that may not be ideal with the benefit of hindsight?

3. Do you think the repercussions of the Lehman bankruptcy were even larger than the Treasury and Federal Reserve expected, and if so what element(s) do you think they misjudged?

4. For Morgan Stanley and Goldman Sachs, what were the benefits and disadvantages of becoming bank holding companies? What does designation as bank holding companies mean for the way Morgan and Goldman have needed to operate since 2008?

Reference no: EM133115373

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