Brokerdealer.com blog update courtesy of excerpt from Bloomberg LP and reporters Leslie Picker and Dakin Campbell
Wall Street brokerdealers are changing the way they pitch for IPOs as investment banks prepare to settle with regulators, people with knowledge of the matter said, following claims analysts inflated estimates to win business for their banks.
The settlement with the Financial Industry Regulatory Authority, or Finra, which may be announced next month, will focus on meetings between analysts and companies ahead of their IPOs, said the people, who asked not to be identified because the information is private. At least seven banks, including Goldman Sachs Group Inc. and JPMorgan Chase & Co. (JPM), may be asked to pay a fine of about $50 million collectively as part of an agreement, the people said.
“We cannot confirm the existence of enforcement investigations or related matters,” Nancy Condon, a spokeswoman for Finra, said in a statement.