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1. MERCHANT BANKER

2. EVOLUTION
• It was firstly started in London merchants by
entering in financing foreign bills.
• Over a period they extended their activities to
domestic business.
• The post war period witnessed rapid growth of
merchant banking.

3. WHO IS M.B?
It is a person who is engaged in a business of
issue management. It is mandatory to appoint
a merchant banker in case of public issue,
right issue, open offers etc.

4. CONSIDERATION FOR GRANTING
CERTIFICATE
STEP 1: The applicant shall be a body corporate.
STEP 2: After granted registration they have to
act like a primary dealer.
STEP 3: Applicant must have the necessary
infrastructure.
STEP 4: The applicant should have working
experience of 2 yrs.
STEP 5: Should fulfill the capital adequacy
requirement.

5. FUNCTIONS
• Raising finance for clients
• Broker in stock exchange
• Project management
• Advice on expansion and modernisation
• Managing public issue of company

6. • Handling government consent for industrial
projects.
• Leasing services
• Portfolio management
• Services to public sector units

7. SCOPE
Below mentioned points are scope of merchant
banking
• Growth of new issue market
• Entry of foreign investors
• Changing policy of financial institiutions
• Disinvestments
• Corporate restructuring

8. SERVICES
• Corporate counselling
• Loan syndication
• Post issue management
• Portfolio management
• Project counselling

9. RESPONSIBILITIES
With regards to SEBI and IPO responsibility of a
merchant banker are:-
• No merchant banker shall agree to manage
with any issue
• Advisory services for project
• Managing of public issue of securities
• Educating the applicant company
• Underwriting arrangement

10. OBLIGATIONS
OBLIGATIONS ARE DIVIDED INTO TWO
CATEGORIES:
Pre-issue obligations
Post-issue obligations

11. Pre-issue obligation
• Submitting the offer document
• Submitting the undertaking
• Submitting of list of promoters group
• Appointments of intermediaries
• Making the offer document public
• Entering into an agreement with the
depositaries

12. Post-issue obligation
• Submitting post issue monitoring report.
• Redressal the investor grievances.
• Maintaining the close co-ordination with the
intermediaries.
• Insuring full subscription of the issue.
• Verified post issue advertisement details.
• Finalising the basic of allotment and allotment
process.

13. SEBI GUIDELINES
SEBI has made the following reforms:-
• Multiple category of merchant banker will be
abolished.
• The merchant banker is allowed to perform
underwriting activity.
• They have to confine himself only to capital
market activities.

14. RECOGNITION BY SEBI
• Professional competence of merchant bankers.
• Their capital adequacy.
• Track record, experience and general
reputation of merchant bankers
• Adequacy and quality of personal employed by
them.

15. CLASSIFICATION OF M.B
SEBI has classified it into 4 categories
CATEGORY 1
CATEGORY 2
CATEGORY 3
CATEGORY 4

16. THANK YOU..!!