A merchant bank is a commercial bank that meets the banking needs of international finance. This is not the type of bank where customers open a savings of checking account or offers online banking. A merchant bank is known to be a wholesale banker because it deals with large financial institutions for the most part.
Merchant banks deal mostly in stock underwriting. Any company that seeks to raise stock from investors will hire a merchant bank to underwrite the process. The merchant bank controls the whole process in determining how much stock to offer and at what price to offer it. The merchant bank deals with the paperwork and markets the company for prospective stock holders. If the company is particularly large they can hire more than one merchant bank to get the job done.
Merchant banks only deal with large companies so they’re extremely specialized and some merchant banks will specialize even further to only one field of merchant banking.
The biggest banks have a retail bank for depositors and a merchant bank for commercial banking. An everyday person wouldn’t have much need for a merchant bank and have probably never dealt with one. You don’t hear much about merchant banking because they operate purely in the business world.