Though both Merchant Banking Institutions and Investment Banks contain the word “bank,” neither is actually a bank in the traditional terms where one would normally perform such activities as checking and savings accounts. In fact, at their core, they are quite different types of financial institutions that perform otherwise different services.
Investment banks, on the one hand, tend to focus on raising funds for businesses and even some government entities by registering and issuing debt and/or equity and selling the result to the market.
Merchant Banking differs as companies who are part of this category primarily perform their services in the field of international project financing (or foreign corporate investing), real estate, and the facilitation of international transactions. This is not to say that merchant banking companies cater only to foreign-based transactions, but rather that they are to be considered as global private financial services institutions.
As ever, always make sure that you make an informed decision in all cases,
All the Best,
2 thoughts on “Investment Banking vs Merchant Banking”
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