Qualities and Functions of Merchant Banker

Qualities of Merchant Banker

A merchant banker must have certain qualities necessary to perform his designated functions. The essential qualities of a merchant banker are generally as follows: (a) He must have expertise, (b) He must have integrity and (c) He must be capable of building up the requisite banker-customer relationship.

Functions of Merchant Banker

A merchant banker performs many functions. Some of the important functions undertaken by a merchant banker are as follows:
  • Underwriting of initial public offering of shares and debentures, 
  • Appraising, promoting and financing domestic or overseas projects by raising resources in the form of equity, debenture and long-term loans;
  • Extending assistance for and participating in international consortia to raise foreign currency loans;
  • Taking deposits and participating in money market operations including foreign exchange dealings;
  • Assisting in raising of Capital by means of private finance, right issues, public offer for sale or issue of loan capital;
  • Providing advice or consultancy to the corporate sector in the areas of finance, investment, capital and management structure etc;
  • Offering advisory services and managing the investment portfolios of individuals, socities, trusts etc. for promotion of investment and 
  • Maintaining relations with the government, semi-government, public and private agencies. 

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