Editing Investment banking (section)

=====Risk management=====
[[File:Risk in Banking.jpg|thumb|Risk in banking]]
{{see|Financial risk management#Investment banking}}
{{see also|Bank#Capital and risk|Treasury management#Banks|Quantitative analysis (finance)#Risk management|Financial analyst#Middle office}}
Risk management involves analyzing the [[market risk|market]] and [[credit risk]] that an investment bank or its clients take onto their balance sheet during transactions or trades. 

Middle office "Credit Risk" focuses around capital markets activities, such as [[syndicated loan]]s, bond issuance, [[restructuring]], and leveraged finance. 
These are not considered "front office" as they tend not to be client-facing and rather 'control' banking functions from taking too much risk. 
"Market Risk" is the control function for the Markets' business and conducts review of sales and trading activities utilizing the [[value at risk|VaR model]]. 
Other Middle office "Risk Groups" include country risk, operational risk, and counterparty risks which may or may not exist on a bank to bank basis.

Front office risk teams, on the other hand, engage in revenue-generating activities involving debt structuring, restructuring, [[syndicated loan]]s, and securitization for clients such as corporates, governments, and hedge funds. 
Here "Credit Risk Solutions", are a key part of capital market transactions, involving [[Structured_finance#Structure|debt structuring]], exit financing, loan amendment, [[project finance]], [[leveraged buy-out]]s, and sometimes portfolio hedging. 
The "Market Risk Team" provides services to investors via derivative solutions, [[Portfolio manager|portfolio management]], portfolio consulting, and risk advisory.

Well-known "Risk Groups" are at [[JPMorgan Chase]], [[Morgan Stanley]], [[Goldman Sachs]] and [[Barclays]]. 
J.P. Morgan IB Risk works with investment banking to execute transactions and advise investors, although its Finance & Operation risk groups focus on middle office functions involving internal, non-revenue generating, operational risk controls.<ref>{{Cite web |url=http://www.jpmorgan.com/pages/jpmorgan/investbk/solutions/riskmgmt |title=Risk Management Consulting {{!}} J.P. Morgan<!-- Bot generated title --> |access-date=2013-02-23 |archive-date=2013-03-19 |archive-url=https://web.archive.org/web/20130319012103/http://www.jpmorgan.com/pages/jpmorgan/investbk/solutions/riskmgmt |url-status=live }}</ref><ref>{{Cite web|url=http://careers.jpmorgan.com/student/jpmorgan/careers/europe/business/ops|title=J.P. Morgan &#124; Operations – internships and graduate roles<!-- Bot generated title -->|access-date=2013-02-23|archive-date=2013-05-15|archive-url=https://web.archive.org/web/20130515111915/http://careers.jpmorgan.com/student/jpmorgan/careers/europe/business/ops|url-status=live}}</ref><ref>{{Cite web|url=http://careers.jpmorgan.com/student/jpmorgan/careers/us/business/finance|title=J.P. Morgan &#124; Business areas – Finance<!-- Bot generated title -->|access-date=2013-02-23|archive-date=2013-01-27|archive-url=https://web.archive.org/web/20130127155125/http://careers.jpmorgan.com/student/jpmorgan/careers/us/business/finance|url-status=live}}</ref> The [[credit default swap]], for instance, is a famous credit risk hedging solution for clients invented by J.P. Morgan's [[Blythe Masters]] during the 1990s. 
The Loan Risk Solutions group<ref>Barclays Risk Loan http://www.barcap.com/client-offering/investment-banking.html {{Webarchive|url=https://archive.today/20130407181316/http://www.barcap.com/client-offering/investment-banking.html |date=7 April 2013 }}</ref> within Barclays' investment banking division and Risk Management and Financing group<ref>{{Cite web |url=http://www.goldmansachs.com/what-we-do/securities/prime-brokerage/risk-mgmt-and-financing.html |title=Goldman Sachs {{!}}  Prime Brokerage – Risk Management and Financing<!-- Bot generated title --> |access-date=23 February 2013 |archive-url=https://web.archive.org/web/20180707170827/http://www.goldmansachs.com/what-we-do/securities/prime-brokerage/risk-mgmt-and-financing.html |archive-date=7 July 2018 |url-status=dead }}</ref> housed in Goldman Sach's securities division are client-driven franchises.

Risk management groups such as credit risk, operational risk, internal risk control, and legal risk are restrained to internal business functions — including firm balance-sheet risk analysis and assigning the trading cap — that are independent of client needs, even though these groups may be responsible for deal approval that directly affects capital market activities. 
Similarly, the ''Internal corporate strategy'' group, tackling firm management and profit strategy, unlike corporate strategy groups that advise clients, is non-revenue regenerating yet a key functional role within investment banks.

This list is not a comprehensive summary of all middle-office functions within an investment bank, as specific desks within front and back offices may participate in internal functions.<ref>{{Cite web|url=https://www.goldmansachs.com/careers/divisions/finance/|title=Goldman Sachs &#124; Finance|website=Goldman Sachs|access-date=2022-02-01|archive-date=2022-02-01|archive-url=https://web.archive.org/web/20220201000705/https://www.goldmansachs.com/careers/divisions/finance/|url-status=live}}</ref>