PPT ON MERCHANT BANKING FOR S.Y.B.F.M

1. Merchant Banking

2. GROUP MEMBERS
NAME ROLL NOS
AKASH JAIN 16
AMBER JAIN 17
ANKIT JAIN 18
ARCHANA JAIN 19
AASHIT JAIN 20

3. Introduction
According to SEBI Merchant Bankers rules 1992 &
The Notification of the Ministry of Finance the
merchant banker is :-
“Any person who is engaged in the business of
issue management either by making
arrangements regarding selling, buying or
subscribing to securities as manager-consultant,
advisor or rendering corporate advisory services
in relation to such issue management”

4. History
Merchant banking started in Italy in late medieval
times
Reached in France during the seventeenth century
Italian merchant bankers introduced Merchant
banking into England in eighteenth century
European bankers developed merchant banking In
USA
In 1972, merchant banking started in South Africa
In 1967, National Grindlays Bank started merchant
banking in India

5. HISTORY AND ORIGIN OF MERCHANT
BANKING IN INDIA
Origin
Merchant banking in India
historical perspective

6. Merchant Banking In India
Foreign bank National Grindlays Bank started
merchant banking in 1967
 Then Citibank in1970 & State Bank of India in
1972 started merchant banking
 Later ICICI set up its merchant Banking
Division followed by Bank of India, Bank of
Baroda, Canara Bank etc..

7. Main Services Provided By Merchant Banks
Corporate Counselling
Project Counselling
Loan Syndication
Managers to Issue
Underwriting
Portfolio Management
Non-Resident Investment
Advising On Mergers And Take-Over
Arranging Offshore Finance
Management of Debenture Issue
Assistance in issue of ADR/GDR

8. Main Services Provided By Merchant Banks
Particular Summary
Corporate
Counselling
Covers the entire field of merchant banking , of
giving suggestions
Project
Counselling
Preparing project report for govt. Approval ,
financial assistance
Loan Syndication
Assistance rendered to get term loan for project,
help client make appraisal, designing capital
structure etc
Managers to Issue
Drafting, completion of formalities, appoint
Registrar etc
Underwriting
Guarantee given by the underwriter, make raising
of external resource easy
Portfolio
Management
Investment in different kind of securities

9. Non-Resident
Investment
Provide help in better and smooth trade to
Non-Resident Investments
Advising On
Mergers & Take-
Over
Middlemen in setting negotiation, provide advise
Arranging Offshore
Finance
Help in areas funds involving foreign currency
Management of
Debenture Issue
As in public issue of shares, merchant bankers
also undertake similar responsibilities in case of
public issue of debentures
Assistance in issue
of ADR/GDR
Merchant bankers helps Corporate to issue
ADRs/GDRs in US and other global markets

10. MERCHANT BANK
• They Serve mainly large
companies and very
wealthy individuals.
• Merchant banking
focuses on investing a
depositor’s assets in a
finance portfolio and
managing these
investments
• Merchant banks are
commonly called as
“Investment Banks”
COMMERCIAL BANK
• This is accessible to
anyone for basic
banking needs
• A commercial bank
can provide loans to
individuals and small
businesses
• Typically referred to
as “Banks”
COMPARISION BETWEEN MERCHANT
BANK & COMMERCIAL BANK

11. MERCHANT BANK
• Apart from raising
funds by investing
and managing the
assets of wealthy
clients, it also
offers counsel and
advice to large
corporations
COMMERCIAL BANK
• It raises funds by
collecting deposits
from groups of
people as well as
interest charged on
loans

12. Problems of MERCHANT BANKERS
SEBI guidelines have authorized merchant bankers to
undertake issue related activities only.
SEBI guidelines stipulate a minimum net worth of Rs. 1 crore
for authorization of merchant bankers.
Non co-operation of the issuing companies.

13. THANK YOU