DEFINITION of 'Underbanked'

A situation where an underwriter of a new securities issue has been unsuccessful in getting other firms to become members of the underwriting group or syndicate. As a result, the security will not be sold to as many clients as had been desired.

Underbanked can also refer to an individual or business that heavily relies on checks and cash as a mean of funding rather than bank related methods such as credit cards or loans.

BREAKING DOWN 'Underbanked'

An investment banker is underbanked when he or she is facing challenges in acquiring additional members for the underwriting group or syndicate for a new securities issue. If the originating investment banker is unable to find enough firms, he or she may not be able to underwrite the issue - and therefore would be unable to offer the security for sale.

  1. Investment Banker

    Someone working at an institution raising capital for companies, ...
  2. Investment Bank - IB

    A financial intermediary that performs a variety of services. ...
  3. Syndicate

    A professional financial services group formed temporarily for ...
  4. Initial Public Offering - IPO

    The first sale of stock by a private company to the public. IPOs ...
  5. Lead Underwriter

    A investment bank or other financial outfit that has the primary ...
  6. Investment Banking

    A specific division of banking related to the creation of capital ...
Related Articles
  1. Insurance

    The Rise Of The Modern Investment Bank

    Get to know a little bit about the institutions whose actions help to guide free markets.
  2. Professionals

    Top Things To Know For An Investment Banking Interview

    Without some basic knowledge, you won't get the job. Find out what you need to know and how to prepare.
  3. Professionals

    How To Make $1 Million In Finance

    The best opportunities to maximize sheer earning power are in investment banking, private equity and hedge funds. Find out what it takes to succeed in these ultra-lucrative areas of finance. ...
  4. Professionals

    Wanna Be A Bigwig? Try Investment Banking

    A career in this high-stress field can be very rewarding for the right person. Find out if you have what it takes.
  5. Professionals

    Getting An Investment Bank Job During A Recession

    Even in a recession, investment banks are seeking new talent. Learn what will set you apart from the crowd!
  6. Professionals

    Common Interview Questions for Financial Auditors

    Identify questions commonly asked at financial auditor job interviews, and learn to formulate winning responses that give your candidacy a boost.
  7. Professionals

    Career Advice: Investment Banking Vs. Asset Management

    Compare and contrast investment banking and asset management as career opportunities, and understand which is a better fit based on your skill set and goals.
  8. Financial Advisors

    Becoming an Advisor: Why You Should Shadow a Pro

    Meeting with financial advisors and following them during a workday will help you to know if it’s worth the time and effort to make the career switch.
  9. Professionals

    The Best Financial Modeling Courses for Investment Bankers

    Obtain information, both general and comparative, about the best available financial modeling courses for individuals pursuing a career in investment banking.
  10. Professionals

    Credit Risk Analyst: Job Description and Average Salary

    Learn what credit risk analysts do every day and how much money they make on average, and identify the skills and education needed for this career.
  1. Do financial advisors have to find their own clients?

    Nearly all financial advisors, particularly when new to the field, have to find their own clients. An employer may provide ... Read Full Answer >>
  2. Do financial advisors get drug tested?

    Financial advisors are not drug tested by any federal or state regulatory body. This means you may receive your Series 6, ... Read Full Answer >>
  3. Is a financial advisor required to have a degree?

    Financial advisors are not required to have university degrees. However, they are required to pass certain exams administered ... Read Full Answer >>
  4. Do financial advisors have to be licensed?

    Financial advisors must possess various securities licenses in order to sell investment products. The specific products an ... Read Full Answer >>
  5. Do financial advisors need to meet quotas?

    Most financial advisors are required to meet quotas, particularly if they work for firms that pay base salaries or draws ... Read Full Answer >>
  6. Does a financial advisor need an MBA?

    Obtaining a license as a financial adviser does not require an Master's of Business Administration (MBA) degree. The Certified ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Cyber Monday

    An expression used in online retailing to describe the Monday following U.S. Thanksgiving weekend. Cyber Monday is generally ...
  2. Bar Chart

    A style of chart used by some technical analysts, on which, as illustrated below, the top of the vertical line indicates ...
  3. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
  4. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  5. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  6. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
Trading Center