* $58.27 billion convertibles issued year to date
* Morgan Stanley top convertible underwriter in second quarter
* $41.12 billion convertibles issued in second quarter
* Second quarter is biggest ever for convertibles
* Citigroup top convertible underwriter in June
* $17.68 billion convertibles issued in June
New York, June 30 - Citigroup moved up to the number one position among convertible underwriters so far this year as the market finished a record quarter, according to data compiled by Prospect News.
Taking the top spot from JP Morgan, the previous year-to-date leader, Citigroup has brought to market $9.66 billion of convertibles in 39 deals so far in 2003.
Issuance meanwhile has now reached $58.27 billion in 198 deals following $41.12 billion in 147 new offerings during the second quarter and $17.68 billion in 59 transactions in June (the figures include investment bank synthetic offerings, that is, deals issued by investment banks and exchangeable for another company's stock. Excluding these deals, the 2003 total is $55.64 billion in 147 deals, the second quarter figure is $40.00 billion in 116 deals and the June volume is $17.34 billion in 54 deals. All figures are for dollar-denominated securities offered in the U.S.).
Those statistics also mean June has matched May 2003 as the busiest month ever for new deals - and will likely become the new record setter once all investment-bank synthetics are filed with the Securities and Exchange Commission. The dollar value beats May's $14.05 billion but remains below the all-time high of $21.16 billion set in May 2001.
However the second quarter's activity does beat the previous three-month record of $38.77 billion in the second quarter of 2001.
Issuance is also running far ahead of 2002's pace and is not far short of the comparable figure for the record-setting year of 2001. For the first half of 2003, new deal volume is 23.5% above the level at the mid-point of 2002 when there had been a total of $47.17 billion of new deals. And it is at 90.1% of the $64.65 billion for the first half of 2001. That year eventually ended with record convertible issuance of $114.81 billion.
Among underwriters, Citigroup was top in June, handling $4.63 billion in 16 deals.
Boosting the firm's total was its role as joint bookrunner on General Motors Corp.'s $4 billion offering and Schlumberger Ltd.'s $1.3 billion in two parts as well as its sole bookrunner position on Nabors Industries Ltd.'s $700 million transaction.
That performance propelled it into the number one position so far this year, taking the lead from JP Morgan, which was top at the end of May.
JP Morgan is now third year to date although only $16 million separates it from number-two placed Morgan Stanley - a margin which could easily change, depending on the exercise of greenshoes.
Morgan Stanley had a remarkably strong second quarter, placing first compared to its number-seven position in the first three months of the year.
Also notable is the concentration of business among a small number of firms. The top two underwriters - Citigroup and Morgan Stanley - handled almost one third (31%) of this year's new convertibles. Adding in third-placed JP Morgan covers 45% of issuance. And the top 10 investment banks accounted for virtually all the new deal volume. US Bancorp Piper Jaffray at number 11 was bookrunner on one deal valued at $600 million so far this year.
Year to date
2002 comparables
| Underwriter | Amount | No. | Rank | Amount | No.
|
| 1. | Citigroup | $9,660.62 | 39 | 2 | $9,550.96 | 32
|
| 2. | Morgan Stanley | $8,220.83 | 38 | 5 | $3,526.39 | 10
|
| 3. | JP Morgan | $8,204.63 | 30 | 4 | $3,663.81 | 13
|
| 4. | Merrill Lynch | $7,670.15 | 35 | 1 | $12,716.36 | 35
|
| 5. | Goldman Sachs | $6,749.46 | 43 | 3 | $7,417.80 | 19
|
| 6. | Banc of America | $4,256.88 | 21 | 7 | $1,958.34 | 8
|
| 7. | CSFB | $3,760.42 | 17 | 6 | $3,308.89 | 14
|
| 8. | UBS | $3,102.66 | 16 | 10 | $1,188.00 | 9
|
| 9. | Deutsche Bank | $2,621.80 | 13 | 9 | $1,395.00 | 6
|
| 10. | Lehman | $2,000.32 | 13 | 8 | $1,459.19 | 8
|
|
|
| Total | $58,269.68 | 198 | $47,173.24 | 143
|
|
|
| Average size | $288.74 | $329.88
|
|
|
|
|
| Second quarter
|
| | | | | 2002 comparables
|
| Underwriter | Amount | No. | Rank | Amount | No.
|
| 1. | Morgan Stanley | $7,124.20 | 33 | 11 | $76.33 | 2
|
| 2. | Citigroup | $6,805.45 | 27 | 1 | $4,197.97 | 14
|
| 3. | Merrill Lynch | $5,687.74 | 24 | 2 | $3,792.64 | 15
|
| 4. | JP Morgan | $5,191.92 | 23 | 3 | $1,691.31 | 7
|
| 5. | Goldman Sachs | $4,681.42 | 29 | 4 | $1,507.10 | 10
|
| 6. | CSFB | $2,756.25 | 13 | 6 | $977.56 | 4
|
| 7. | UBS | $2,576.83 | 13 | 8 | $730.00 | 5
|
| 8. | Banc of America | $1,709.17 | 11 | 7 | $948.34 | 4
|
| 9. | Lehman | $1,419.07 | 10 | 9 | $570.00 | 4
|
| 10. | Deutsche Bank | $1,284.17 | 10 | 5 | $1,025.00 | 4
|
|
|
| Total | $41,115.13 | 147 | $15,811.00 | 64
|
|
|
| Average size | $279.69 | $ 247.05
|
|
|
| June
|
| | | | | 2002 comparables
|
| Underwriter | Amount | No. | Rank | Amount | No.
|
| 1. | Citigroup | $4,631.64 | 16 | 2 | $698.56 | 5
|
| 2. | Goldman Sachs | $2,351.30 | 15 | 5 | $391.57 | 4
|
| 3. | Merrill Lynch | $2,302.92 | 9 | 4 | $403.00 | 2
|
| 4. | Morgan Stanley | $2,202.92 | 10 | - | - | -
|
| 5. | JP Morgan | $1,887.08 | 10 | 1 | $1,081.31 | 5
|
| 6. | CSFB | $1,193.75 | 6 | 3 | $561.31 | 2
|
| 7. | Banc of America | $992.50 | 6 | 7 | $110.00 | 1
|
| 8. | UBS | $950.00 | 4 | 8 | $86.25 | 1
|
| 9. | Lehman | $327.50 | 2 | 6 | $370.00 | 3
|
| 10. | Deutsche Bank | $207.50 | 2 | - | - | -
|
|
|
| Total | $17,682.11 | 59 | $3,780.74 | 18
|
|
|
| Average size | $299.70 | $ 210.04
|
|
|
Criteria
* The tables include all dollar-denominated offerings sold in the U.S. as public or Rule 144A deals reported to Prospect News.
* Offerings are included in the time period in which they price.
* Amounts are based on the total sales price (face amount multiplied by the offering price). The full amount is credited to the bookrunner (or lead manager if no bookrunners). For multiple bookrunners (or lead managers), the total value is divided equally among all the firms.
* Each tranche is counted as a separate deal.
* Bonds are included that convert into the issuer's or another company's stock or the cash equivalent; bonds that convert into other bonds are excluded.
* Units made up of a bond and stock are included; units made up of a bond and warrants are excluded.
* Preferred issues are included using the same criteria as for bonds.
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