Merchant bank

In banking, it is a traditional term for an Investment Bank. It can also be used to explain the private equity activities of banking. This article is about the past of banking as developed by merchants, from the Middle Ages onwards.

Merchant banks, now so called, are in reality the original "banks". These were made-up in the middle Ages by Italian grain merchants. As the Lombardy merchants and bankers grew in stature based on the strength of the Lombard plains cereal crops, many displaced Jews fleeing Spanish harassment were attracted to the trade. They brought with them antique practices from the middle and Far East silk routes. Originally planned for the finance of long trading journeys, these methods were now utilized to finance the production of grain.