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Citigroup
ousts Merrill as top underwriter: Thomson
New York, Dec 31: Citigroup Inc became Wall Street’s
largest underwriter of stocks and bonds in 2001, Thomson Financial
Securities Data said on Monday, ending Merrill Lynch &
Co’s 11-year run at the top.
New York-based Citigroup’s Salomon Smith
Barney unit arranged $486.9 billion of sales, capturing 12
per cent of a $4.08 trillion market. Merrill Lynch placed
second, with $432.7 billion of sales and a 10.6 per cent market
share.
Salomon, which changes its name to Citigroup next quarter,
has won more underwriting assignments by bundling them with
less profitable services such as credit lines, analysts said.
Citigroup was formed in 1998 when bank holding company Citicorp
merged with insurance giant Travelers Group to give consumers
a one-stop "supermarket" for a variety of financial
services.
"It has always been a question of when, not if, Citigroup
would become No 1," said Richard Peterson, a market strategist
at Thomson. "Perhaps the No 1 ranking validates the ‘supermarket’
concept of banking," Peterson added.
Credit Suisse First Boston, a unit of Credit Suisse Group
Inc, finished third with $346.9 billion of sales.
The banks set records despite seeing business grind to a halt
for much of September, following the attacks of Sept 11. "The
markets were incredibly resilient," said Jim Merli, global
head of fixed-income syndicate at Lehman Brothers Inc.
Wall Street banks covet high rankings in Thomson’s so-called
"league tables," which give them bragging rights
and can help them drum up new business.
Though underwriting rose 25 per cent from 2000’s revised $3.27
trillion, Thomson said disclosed fees fell 16 per cent to
$17.8 billion. It cited soft markets for equity offerings,
where fees often hit 4 per cent, and initial public offerings,
where Thomson said fees averaged 6.5 per cent in 2001.
Salomon in 2001 garnered the most fees, netting $2.4 billion,
followed by Goldman Sachs Group Inc and Morgan Stanley.
The year was also a chilly one for fee-rich merger and acquisition
advising, as global merger activity fell by half to $1.71
trillion, Thomson said.
— Reuters
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