Banks maintain historical rates to invest in private comapnies and then advise on their flotations.

Merchant banks searching for the edge in legitimately making money by using information flows have been found as minority investors in private companies before their listing as well as advisers to the flotations – but not as often as they would perhaps have liked. Investment banks as investors, not advisers, have outweighed those advising after investing by three to one, according to data provider Dow Jones VentureSource.

From 1992 to end-March this year, investment banks have invested in 90 deals…