Why are they so concerned about making careful investigation

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Reference no: EM13304093

Before entering a formal agreement, investment banks carefully investigate the companies whose securities they underwrite; this is especially true of the issues of firms going public for the first time. Since the banks do not themselves plan to hold the securities but intend to sell them to others as soon as possible, why are they so concerned about making careful investigations?

Reference no: EM13304093

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