Salomon SB Finishes Atop Quarterly League Tables

During a period of shrinking issuance, Salomon Smith Barney took top honors in the second quarter for high yield underwriting, while Donaldson Lufkin & Jenrette retained its top position for the year-to-date period.

According to Thomson Financial Securities Data, the high yield market fell off nearly 40% to $31 billion in new issues in the quarter. That compares with $49.6 billion in the second quarter of last year, when the market was still awash with deals prior to the capital markets downturn last August.

Taking the largest piece of a smaller pie, Salomon SB last quarter nabbed a 14.3% market share for total proceeds of $4.4 billion, compared with year-ago numbers of 9.5% and $4.9 billion. However, company officials were quick to point out that DLJ is still ahead of the pack year-to-date.

"One quarter does not make a year," said Steve Jones, head of capital markets globally. However, Jones is still pleased to have risen to a solid number-two player year to date, he said, and the company plans to continue to take market share.

DLJ, which did not return phone calls, came in second on the quarter with a 13.8% market share, down from last year 18.8%. Rounding out the top five this quarter are: Morgan Stanley Dean Witter (12.5% market share and $3.8 billion in proceeds); Chase Securities (10.0% market share and $3.1 billion in proceeds); and Goldman Sachs (8.3% market share and $2.6 billion in proceeds).

Several large issues helped push Salomon SB to the top spot in the quarter, according to investors. Those included a billion-dollar transaction from International Gaming Technology, a $900 million deal from Nextlink, and a $500 million deal from AES.

The largest part of Salomon's increase came in the public market, where it captured fully 37% of the $6 billion market during the quarter. The second-busiest underwriter in the public market was Morgan Stanley Dean Witter, which had a 15.3% share.

In the 144A portion of the market, DLJ still reigned with a 15.9% share of the market. In that category, Salomon Smith Barney did not even break the top three, finishing in the fourth spot. Morgan Stanley Dean Witter and Chase were the numbers two and three underwriters in the 144A market.