Merchant Banking Services Market Size, Share & Trends Analysis Report By Services (Portfolio Management, Business Restructuring), By Service Provider, By End-user, By Region, And Segment Forecasts, 2022 - 2030

Merchant Banking Services Market Size, Share & Trends Analysis Report By Services (Portfolio Management, Business Restructuring), By Service Provider, By End-user, By Region, And Segment Forecasts, 2022 - 2030

Merchant Banking Services Market Growth & Trends

The global merchant banking services market is anticipated to reach USD 143.94 billion by 2030, expanding at a CAGR of 16.8% from 2022 to 2030, according to a new report by Grand View Research, Inc. The areas covered under merchant bank services include equity underwriting, portfolio management, and credit application processing received from financial institutions. The primary expertise of merchant banks operating within the industry is to help develop a financial plan for project execution and provisioning credit facilities, cost estimation, and catering to legal and working capital requirements.

The merchant banking industry has been gaining traction for specialized functions such as private placements. Private placements refer to the ability to raise capital for a company by selling its shares to a small number of private investors. Private placements differ from initial public offerings, wherein in the latter, anyone interested can purchase the shares of a company from the open market.

Merchant bank services also involve structured trade finance and debt funding. Structured trade finance is a well-adopted alternative to conventional lending, especially in emerging nations, to enable import-export transactions. Debt funding enables public and private companies to raise funds by issuing corporate debentures.

The COVID-19 pandemic had an immediate impact on merchant bank and their services. Small and large-scale investors resorted to flight to the safety of capital temporarily in the uncertain environment induced by the coronavirus. Merchant bank services heavily depend on a risk-on economic climate and can be vulnerable to economic uncertainties and downturns with high redemptions.

Merchant Banking Services Market Report Highlights

• The business restructuring segment is expected to witness significant growth over the forecast period. Merchant bank services include mediating the takeover or merger and acquisition deal between companies in return for a fee. The segment growth is expected to accelerate amidst a surge in startups and profitable companies with high potential to be acquired by bigger players
• The non-banking institutions segment is expected to witness the fastest growth over the forecast period. The growth can be attributed to a specialized delegated workforce covering diverse parts of capital markets. Moreover, investment firms deal with high-value transactions and have economies of scale since they manage large sums of money
• The businesses segment is expected to witness the fastest growth over the forecast period. Merchant bank services add value to business clients by helping them create a strategic plan to expand operations through inorganic ways of entering new markets, including partnerships and collaborations. Merchant bank services also ensure adherence to legal requirements in domestic and international transactions
• Asia Pacific is anticipated to emerge as the fastest-growing region, attributed to a growing capital market and a substantial number of key merchant bank service providers in the region. The highly liquid capital market in the region is well-represented by Morgan Stanley Capital International (MSCI) Emerging Markets Asia Index comprising nine Asian markets, including China, India, South Korea, and Taiwan