MERCHANT BANKINGby DollarBillionaire™
High-Performance Individuals understand banking and the various types of banks that exist. Here we define what Merchant Banking is and give a broad overview of how these banks operate.
In this Teaching Document, you will find the DollarBillionaire ™ Guidance Notes on Merchant Banking.
Written by Barron Hall. Revised and Updated Wednesday 07 August 2019.
Table of Contents: [toc]
MERCHANT BANKING DEFINITION
Merchant Banking is a bank that provides Underwriting, Loan Services, Fundraising Services, Business Advisory Service and International Financing for small to medium-sized multinational corporate clients and high net-worth individuals who operate in many countries. Merchant Banks invest directly in the equity of businesses rather than supplying loans. These banks specialize in International Trade. They do not deal directly with the public and they do not provide deposit regular banking services like savings and checking accounts.
What is “Merchant Banking”
Merchant Banks deal with businesses, governments, private and public companies, private equity firms, and other institutions. These banks are very similar to Investment banks, however, they provide services tailored more to Multinational Clients and high net worth individuals who operate in many countries. Merchant Banks normally deal with firms that may not be big enough to use the services of an Investment Bank offering an IPO. These merchant banks might help the firm through a private placement of securities, with less regulatory requirements. These securities would be sold to sophisticated investors. Merchant Banks do not deal directly with the public as commercial banks do, nor do they provide regular banking services like deposit-taking and savings accounts. They render their services for a fee.
In Britain, a Merchant Bank is the same as an Investment Bank. In the USA, this is not the case. In the USA a Merchant Bank is a bank that provides capital to a business in the form of share ownership instead of a loan. Merchant Banks also specialize in international operations, dealing with clients that operate in multiple countries.
Merchant Banks got their name “Merchant Banks” from the fact that they were originally created to facilitate and fund production and trade of commodities.
The Role of Merchant Banking
Merchant banks provide many services to their multinational clients, including underwriting, share issue management, venture capital financing, leasing, acceptance credit and bill discounting, loans including loan syndication, equity financing, bridging finance, credit syndication, portfolio management, international fundraising, foreign corporate investing, financial and corporate advising, project counseling, foreign real estate transactions, trade finance, foreign investments, and other international transactions.
Top Merchant banks include JPMorgan Chase, Bank of America Merrill Lynch, Goldman Sachs, Morgan Stanley, and Citibank.
Graphic: Merchant Banking Services
Explore Types of Banks
DollarBillionaire™ Quick Reference Notes
This document is part of the Extensive set of Concise, Up to date, Quick Reference Notes made available to our Mentees to empower them with the knowledge, skills, rules, secrets, and tips needed to create massive wealth. For each Topic, there is a Knowledge Base, Rules, Secrets, and Guidance Notes. These DollarBillionaire™ Documents are a Subset of the Wealth Creation Syllabus that is taught to all of our Mentees.
These Knowledge Bases, Rules, Secrets and Guidance Notes cover Topics highly relevant to Wealth Creation. They start with Health, Energy, Creativity and Vitality Rules and Secrets. Dead men make no money. For our wide-awake audience, we also include notes covering Banking, Bitcoin, Money, Investment, Business, Entrepreneurship, Motivation, Cash, Success, Prosperity, Abundance, Wealth, and Freedom.
We also supply Notes on Affiliate Marketing, Digital Marketing, SEO, PPC, Investing, Bitcoin Trading, CFD Trading, Day Trading, Derivative Trading, Mean Reversion, Money Flow Index Strategy, Forex Trading, Futures Trading, Options Trading, Scalping, Swing Trading, Technical Analysis, Trading EFTs, and Penny Stocks. Our Mentees can pick and choose useful items.
Studying, Understanding, Remembering, Implementing and Maintaining over time this Knowledge and Wisdom will empower you to Create Revenue, to build multiple Streams of Income, to create Passive Income, to Build Wealth, to Invest Wealth, to Protect Wealth and to Enjoy Your Success, Prosperity, Abundance, Wealth and Freedom.
INVEST IN YOURSELF
DollarBillionaire™ provides Wealth Creation Mentoring and a World Class Mentoring System that empowers an individual to achieve Success, Prosperity, Abundance, Personal Freedom, Financial Freedom, and Massive Multi-Millionaire and Billionaire Class Wealth. This is achieved by a One-on-One Long-term Personal Relationship between DollarBillionaire™'s Mentor and the Mentee.