Managing Underwriter

Leading-and originating-investment banking firm of an Underwriting Group organized for the purchase and distribution of a new issue of securities. The Agreement Among Underwriters authorizes the managing underwriter, or syndicate manager, to act as agent for the group in purchasing, carrying, and distributing the issue as well as complying with all federal and state requirements; to form the selling group; to determine the allocation of securities to each member; to make sales to the selling group at a specified discount-or Concession-from the public offering price; to engage in open market transactions during the underwriting period to stabilize the market price of the security; and to borrow for the syndicate account to cover costs. See also Flotation Cost; Investment Banker; Underwrite.

Commercial bank or investment bank representing an Underwriting Group in purchase and distribution of a new securities offering. The managing underwriter arranges the selling group; files the necessary registration papers; acts as Agent for the selling group, as authorized by the Agreement Among Underwriters; decides the portion of the offering, or Allotment to be assigned each member; and acts to stabilize the price of the securities during the offering period. For his or her services, the managing underwriter is paid an extra fee from the syndicate's gross profit. Called Lead Bank in the Eurobond market and lead manager in the United States. See also Best Effort; Negotiated Underwriting.