Merchant Bank

Loading the player...

What is a 'Merchant Bank'

A merchant bank is a bank that deals mostly in (but is not limited to) international finance, long-term loans for companies and underwriting. Merchant banks do not provide regular banking services to the general public.

BREAKING DOWN 'Merchant Bank'

Their knowledge in international finances make merchant banks specialists in dealing with multinational corporations.

RELATED TERMS
  1. Merchant Agreement

    A contract between a business and a credit card service provider.
  2. Merchant Account

    A type of business bank account that allows a business to accept ...
  3. Merchant Discount Rate

    The rate chanrged to a merchant by a bank for providing debit ...
  4. Night Depository

    A bank drop box where merchants can deposit their daily cash, ...
  5. Processing Date

    The month, day and year when a merchant’s bank processes a credit ...
  6. Floor Limit

    A purchase amount over which further authorization is needed ...
Related Articles
  1. Economics

    What Does a Merchant Bank Do?

    A merchant bank is a financial institution that performs underwriting, loan services, financial advising and fund raising services to large corporations.
  2. Personal Finance

    The Banking System: Non-Bank Financial Institutions

    ByStephen D. Simpson, CFA Savings and LoansSavings and loan associations, also known as S&Ls or thrifts, resemble banks in many respects. Most consumers don't know the differences between ...
  3. Insurance

    The Rise Of The Modern Investment Bank

    Get to know a little bit about the institutions whose actions help to guide free markets.
  4. Personal Finance

    The Banking System: Conclusion

    ByStephen D. Simpson, CFA Banking systems have been with us for as long as people have been using money. Banks and other financial institutions provide security for individuals, businesses and ...
  5. Credit & Loans

    The Evolution Of Banking

    Banks are a part of ancient history. Find out how this system of money management developed into what we know today.
  6. Investing Basics

    Retail Banking Vs. Corporate Banking

    Retail banking is the visible face of banking to the general public. Corporate banking, also known as business banking, refers to the aspect of banking that deals with corporate customers.
  7. Personal Finance

    The Banking System: Commercial Banking - How Banks Make Money

    ByStephen D. Simpson, CFA As mentioned before, banks basically make money by lending money at rates higher than the cost of the money they lend. More specifically, banks collect interest on ...
  8. Savings

    WePay vs. PayPal Fees

    WePay and Paypal facilitate payments between businesses and people. Which one should you go with?
  9. Personal Finance

    The Banking System: Commercial Banking - Operations

    ByStephen D. Simpson, CFA Retail BankingRetail banking is the banking that almost every reader will find most familiar. Retail banking is the business of making consumer loans, mortgages and ...
  10. Personal Finance

    The Banking System: Commercial Banking - What Banks Do

    ByStephen D. Simpson, CFA Accept Deposits / Make LoansAt the most basic level, what banks do is fairly simple. Banks accept deposits from customers, raise capital from investors or lenders, ...
RELATED FAQS
  1. What is the difference between investment banks and merchant banks?

    Merchant banks and investment banks, in their purest forms, are different kinds of financial institutions that perform different ... Read Answer >>
  2. Why do long-term care insurers require the loss of two Activities of Daily Living ...

    Find out why an importing or exporting merchant might turn to a banker's acceptance to help facilitate an international trade ... Read Answer >>
  3. What are some roles of an investment bank?

    Explore the world of investment banking and discover the various functions that investment bankers serve, such as handling ... Read Answer >>
  4. What factors are the primary drivers of banks' share prices?

    Find out which factors are most important when determining the share price of banks and other lending institutions in the ... Read Answer >>
  5. What is the average profit margin for a company in the banking sector?

    Learn what the average profit margin is for companies in the banking sector, along with other evaluation metrics often used ... Read Answer >>
  6. What is the difference between an investment and a retail bank?

    Learn the primary differences between retail banks and investment banks by examining the business activities, type of clients ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center