Syndicated Members are temporary professional financial alliance services formed for large transactions that will be difficult or impossible for individual entities to carry out. Syndication allows companies to gather their resources and share risks. There are various types of syndicates, including underwriting syndicates, banking syndicates, and insurance syndicates .
Syndicated members are commercial or investment banks responsible for underwriting IPO shares. Syndicate members are usually listed on the SEBI or registered as a broker on the BSE / NSE Stock Exchange. They work as intermediaries for Issuer Companies and IPO share buyers. Investors bid for IPO shares through a Syndicated Member appointed by the Issuing Company.
The purpose of the Syndicated Member
Syndicated members are generally considered a partnership or corporation for tax purposes . Companies can form syndicates for certain business ventures if they promise the potential for attractive returns. The amount of risk taken by each member of the syndicate can also vary. For example, an account that is not divided into investment banking syndicates means that each underwriter in the syndicate is responsible for selling the number of shares allocated together with any excess shares not sold by the syndicate as a whole.
Syndicated members are also often used in the insurance industry to spread insurance risk among several companies. An insurance underwriter evaluates the risk of insuring a particular person or certain assets and uses that evaluation to determine the price of an insurance policy.
Examples from Syndicated Members
Syndicated members can be made by many different businesses in various industries. An example is a drug company, which can combine research and marketing knowledge to create syndicates and develop new drugs. Large real estate projects can be developed using syndicates formed by several real estate companies. Banks will unite to form syndicates to lend large amounts of money to one party.