Private bank

Private banks are banks owned by either an individual or a general partner(s) with limited partner(s). Private banks are not incorporated. In any such case, the creditors can look to both the "entirety of the bank's assets" as well as the entirety of the sole-proprietor's/general-partners' assets.

These banks have a long tradition in Switzerland, dating back to at least the Revocation of the Edict of Nantes (1685). Private banks also have a long tradition in the UK where C. Hoare & Co. has been in business since 1672.

There were many private banks in Europe, but most have now become incorporated companies, so the term is rarely true any more. Today, the term "private bank" can also refer to the financial institution specializing in financial advice and services for high-net-worth individuals (private banking).

"Private banks" can also refer to non-government owned banks in general, in contrast to government-owned (or nationalized) banks, which were prevalent in communist, socialist and some social democratic states in the 20th century.

Investment banking

An investment bank is a financial institution that assists individuals, corporations, and governments in raising financial capital by underwriting or acting as the client's agent in the issuance of securities. An investment bank may also assist companies involved in mergers and acquisitions (M&A) and provide ancillary services such as market making, trading of derivatives and equity securities, and FICC services (fixed income instruments, currencies, and commodities).

Unlike commercial banks and retail banks, investment banks do not take deposits. From the passage of Glass–Steagall Act in 1933 until its repeal in 1999 by the Gramm–Leach–Bliley Act, the United States maintained a separation between investment banking and commercial banks. Other industrialized countries, including G7 countries, have historically not maintained such a separation. As part of the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act of 2010), the Volcker Rule asserts full institutional separation of investment banking services from commercial banking.

J. P. Morgan

John Pierpont "J.P." Morgan (April 17, 1837 – March 31, 1913) was an American financier and banker who dominated corporate finance and industrial consolidation during his time. In 1892, Morgan arranged the merger of Edison General Electric and Thomson-Houston Electric Company to form General Electric. He was instrumental in the creation of the United States Steel Corporation.

At the height of Morgan's career during the early 1900s, he and his partners had financial investments in many large corporations and had significant influence over the nation's high finance and United States Congress members. He directed the banking coalition that stopped the Panic of 1907. He was the leading financier of the Progressive Era, and his dedication to efficiency and modernization helped transform American business.

Morgan died in Rome, Italy, in his sleep in 1913 at the age of 75, leaving his fortune and business to his son, John Pierpont Morgan, Jr.

Childhood and education

Morgan was born into the influential Morgan family to Junius Spencer Morgan (1813–1890) and Juliet Pierpont (1816–1884) in Hartford, Connecticut, and was raised there. Pierpont, as he preferred to be known, had a varied education due in part to the plans of his father. In the fall of 1848, Pierpont transferred to the Hartford Public School and then to the Episcopal Academy in Cheshire, Connecticut (now called Cheshire Academy), boarding with the principal. In September 1851, Morgan passed the entrance exam for The English High School of Boston, a school specializing in mathematics to prepare young men for careers in commerce. In the spring of 1852, an illness struck which was to become more common as his life progressed. Rheumatic fever left him in so much pain that he could not walk, and Junius sent him to the Azores to recover.

Goldman Sachs

The Goldman Sachs Group, Inc. is an American multinational investment banking firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients.

Goldman Sachs was founded in 1869 and is headquartered at 200 West Street in the Lower Manhattan area of New York City, with additional offices in international financial centers. The firm provides mergers and acquisitions advice, underwriting services, asset management, and prime brokerage to its clients, which include corporations, governments and individuals. The firm also engages in market making and private equity deals, and is a primary dealer in the United States Treasury security market.

Goldman Sachs was hit hard by the 2008 economic crisis, because of its involvement in subprime mortgages, and was subsequently rescued as part of a massive U.S. government bailout.

Former Goldman executives who moved on to government positions include: Robert Rubin and Henry Paulson who served as United States Secretary of the Treasury under Presidents Bill Clinton and George W. Bush, respectively; Mario Draghi, President of the European Central Bank; Mark Carney, Governor of the Bank of Canada 2008–13 and Governor of the Bank of England from July 2013 and Malcolm Turnbull, Prime Minister of Australia.

Private equity

In finance, private equity is an asset class consisting of equity securities and debt in operating companies that are not publicly traded on a stock exchange.

A private equity investment will generally be made by a private equity firm, a venture capital firm or an angel investor. Each of these categories of investor has its own set of goals, preferences and investment strategies; however, all provide working capital to a target company to nurture expansion, new-product development, or restructuring of the company’s operations, management, or ownership.

Bloomberg Businessweek has called private equity a rebranding of leveraged-buyout firms after the 1980s. Common investment strategies in private equity include: leveraged buyouts, venture capital, growth capital, distressed investments and mezzanine capital. In a typical leveraged-buyout transaction, a private-equity firm buys majority control of an existing or mature firm. This is distinct from a venture-capital or growth-capital investment, in which the investors (typically venture-capital firms or angel investors) invest in young, growing or emerging companies, and rarely obtain majority control.