Merchant Banking

Our merchant banking equities strategy involves putting our capital to work along side the capital of institutional and retail investors in selected transactions that FBR Capital Markets’ investment banking group underwrites. 

From the beginning of 2001 through December 31, 2006, FBR Group invested more than $550 million in 39 companies for which we helped raise capital.  This activity generated more than $500 million in incremental investment banking fees, and during the same period, the merchant banking portfolio earned an internal rate of return of nearly 12%.  At the end of 2006, the total value of FBR Group’s merchant banking portfolio and other long-term investments was $186 million. Going forward, both FBR Group and FBR Capital Markets will maintain separate merchant banking investment portfolios.