Merchant banking services strengthen the economic development of a country as they acts as sources of funds and
information for corporations. Considering the way the Indian economy is growing, the role of merchant banking
services in India is indispensable. These financial institutes also act as corporate advisory bodies to help
corporations rightly get involved in various financial activities. The need of merchant banking services in India
arises from the fact that high level industrialization is taking place in the country. Some of the PSBs have formed
their fully owned subsidiaries for this purpose. Analysis of merchant banking business of some PSBs clearly
indicates that the merchant banking activities of the banks are showing declining trend especially after 1993-94 due
to depressed capital market conditions and subdued activity in primary market