A company or unit that manages the public issuance and circulation of securities from a company or other supplying body. An underwriter works carefully with the issuing body to govern the proposing price of the securities, purchase them from the issuer and sells them to investors via the underwriter’s distribution grid.

Underwriters usually obtain underwriting fees from their allotting clients, but they also usually make revenues when selling the underwritten shares to investors. However, underwriters adopt the responsibility of distributing a securities issue to the public. If they can’t sell all of the securities at the stated offering price, they may be required to sell the securities for less than they paid for them or recall the securities themselves.