A bank that primarily serves corporate clients and offers a range of services including investment banking, international trading and other fee-based services. Merchant banks rarely accept credit risk and usually provide fee-based services.
A form of banking where the bank arranges credit financing, but doesn't hold loans until maturity. A merchant bank invests its own capital in leveraged buyouts, corporate acquisitions and other structured financial transactions. It is a fee-based business, in which the bank assumes market risk but no long-term credit risk.
Merchant banks offer consultancy services for mergers and acquisitions and financial restructurings, and the associated financing (raising the necessary funds).
form of banking where the institution arranges credit financing, but does not hold the loans to maturity. A merchant bank invests its own capital in leveraged buy-outs, corporate acquisitions and other structured financing transactions. Merchant banks assume market risks but not long term credit risks. This is a common form of banking in Europe and is gaining acceptance in the United States.
An activity that includes corporate finance activities, such as advice on complex financings, merger and acquisition advice (international or domestic), and at times direct equity investments in corporations by the banks.