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Smart Investment Banking: The Reshaping of Business Models and Risk Challenges in Investment Banking Driven by Digital Transformation

In: Proceedings of the 2025 International Conference on Financial Innovation and Marketing Management (FIMM 2025)

Author

Listed:
  • Chun Xiao

    (Lancaster University College at Beijing Jiaotong University, Beijing Jiaotong University)

Abstract

Digital transformation is profoundly reshaping the global investment banking business model, and the application of technology and changes in the market environment pose dual challenges. This study focuses on the application of machine learning in credit rating, the practice of block-chain technology in bond issuance, and the construction of digital service platforms through case studies and theoretical discussions, revealing the path of digital transformation that is reshaping the business model of investment banks. The study finds that machine learning significantly improves the accuracy and efficiency of credit assessment, block-chain technology reduces the cost of bond issuance by enhancing transparency and security, and the digital service platform optimizes the institutional client service process. However, digital transformation also faces multiple challenges such as operational risks (e.g., data quality flaws), regulatory risks (e.g., smart contract vulnerabilities) and reputational risks (e.g., data breaches). Future research could further explore the application of emerging technologies (e.g. quantum computing) in financial data analytics, and deepen the discussion on cross-border legal harmonization and standardization.

Suggested Citation

  • Chun Xiao, 2025. "Smart Investment Banking: The Reshaping of Business Models and Risk Challenges in Investment Banking Driven by Digital Transformation," Advances in Economics, Business and Management Research, in: Maizaitulaidawati Md Husin (ed.), Proceedings of the 2025 International Conference on Financial Innovation and Marketing Management (FIMM 2025), pages 237-244, Springer.
    • Handle: RePEc:spr:advbcp:978-94-6463-874-5_30
    DOI: 10.2991/978-94-6463-874-5_30
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