The paper explores the relationship between investment banking and the global economic crisis. The motivation to select the subject of research arises because it is necessary to explain the factors of financial markets that are causing the emergence of financial crises and their relocation to the real economy. Understanding the causes and consequences of financial crises is crucial for establishing mechanisms to prevent further financial crises. This is particularly important in terms of globalization of the market characterized by a high degree of interdependence of world economies. The research results show that a high share of speculation and the occurrence of moral hazard with an insufficient level of regulation in the market on subprime mortgage lending strongly influenced global financial crisis in the United States. This crisis spread to the rest of the world due to the high degree of dependence of the world economies on the US economy. Thus, the financial crisis on the US subprime mortgage market was one of the factors behind the emergence of a European debt crisis and an exogenous factor that caused the economic crisis in the Republic of Croatia. All of this provides a strong need for regulation and effective risk management in financial sectors.