BANKS’ BROKERAGE AND ADVISORY SERVICES IN FACILITATING SECURITIES TRANSACTIONS AND IMPROVING MARKET LIQUIDITY

Abstract

This paper explores the critical role that commercial banks play in the development and deepening of capital
markets, particularly in both emerging and developed economies. Capital markets are essential mechanisms for mobilizing
long-term funds, fostering investment, and supporting sustainable economic growth. While traditionally perceived
as institutions focused on deposit-taking and lending, commercial banks have increasingly expanded their functions
to include underwriting of securities, management of investment portfolios, and facilitation of financial intermediation
between investors and issuers.
By utilizing a mixed-method approach that includes empirical data analysis, cross-country comparisons, and trend
evaluations from 2015 to 2022, this study reveals a robust positive correlation between the scale and efficiency of
the banking sector and key indicators of capital market development. These indicators include market capitalization,
the number of initial public offerings (IPOs), and the issuance of corporate bonds. Countries with well-capitalized and
diversified banking systems demonstrate stronger capital market activity, higher investor confidence, and more stable
access to financing for the private sector.
Furthermore, the study identifies how policy frameworks, technological innovations, and institutional capacities of
commercial banks influence their effectiveness in supporting capital markets. The findings provide important implications
for financial regulators, policymakers, and development strategists who seek to strengthen financial ecosystems by
promoting closer integration between banking institutions and capital market infrastructure