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by Derek Loosvelt | July 01, 2011


Amid all the sour news about job losses and shrinking revenues, there's some good news on the Street at the halfway mark of 2011. And that news has to do with equity underwriting. For the first six months of the year, global equity underwriting volume was 27 percent higher than it was in the same period last year, and it was the best first-six-month period since 2007.

lloyd blankfein in brooklynAnd who else but everyone's favorite investment bank to hate as of late, Goldman Sachs, is back on top of the league tables.

Indeed, Lloyd "No Sleep Til" Blankfein and gang ranked No. 1 in all of the following equity-underwriting categories (according to Thomson Reuters): global equities, global common stock, global IPOs, global convertibles, U.S. equities, U.S. common stock, U.S. IPOs, U.S. convertibles, EMEA (Europe, Middle East and Asia) equities, EMEA common stock, Asia equities, Asia common stock, and Asia convertibles.

About the only major categories Goldman didn't top were EMEA IPOs (in which Credit Suisse edged out Goldman, which ranked No. 2) and Asia IPOs (Goldman ranked second to Deutsche Bank).

Aside from Goldman's return to worldwide dominance (it had slipped in most of the aforementioned categories last year), other newsmakers from the equity league tables included Macquarie Group, which in global volume leaped from No. 29 to No. 13, and in U.S. volume jumped from No. 33 to No. 13 (Macquarie, an Australian-based investment bank, has been making a move into the U.S. in recent years, which seems to be paying off); and Bank of America Merrill Lynch, which rose one spot -- but an important one -- to rank No. 2 in global equity underwriting, as well as No. 2 in global common stock underwriting.

It's also worth mentioning that the investment bank that had its hands on more of the 10 largest U.S. equity deals during the first half of the year wasn't Goldman or BofA Merrill but Credit Suisse -- the Swiss bank advised on eight of the period's top 10 deals (AIG's $8.7 billion secondary offering was the period's largest in the U.S.; HCA Holdings' $4.4 billion offering was its largest U.S. IPO).

Meanwhile, Goldman had its hands in seven of the 10 largest equity deals; Deutsche Bank, J.P. Morgan, and Morgan Stanley each worked on five; and BofA, Citi, and Barclays Capital each worked on four.

What all this means is that while it's not a great time to work in equity trading (recent financial regulation has taken a huge bite out of Wall Street prop trading revenues) or fiixed-income underwriting (bond deals are down so far this year), it's not a bad time to work in equity underwriting.

And, in fact, with billion-dollar IPOs in the pipeline from Facebook, Groupon, and Zynga (which, today, filed* to go public), it might just be the best time in years.

*Morgan Stanley is leading the offering, which values Zynga at $20 billion; Goldman, J.P. Morgan, BofA Merrill, Barclays Capital, and Allen & Co. will be co-managing.

(DealBook: Zynga Files for $1 Billion IPO)

(Related: LinkedIn, Groupon and Facebook: The Great American Social Media IPOs)


Filed Under: Finance