Though a primary source of industry rumblings, the large-scale defections and hires associated with Credit Suisse First Boston, Prudential Securities, and Deutsche Bank Alex. Brown have yet to impact the industry league tables.

Salomon Smith Barney - as was the case last year - topped the charts in the first quarter with nearly 17% of the market share for U.S. public and Rule 144A combined, according to preliminary figures provided by Thomson Financial Securities Data.

With roughly $8.5 billion in asset-backed proceeds, Salomon surpassed second-place-bank and 1999 champ CSFB by over $2 billion.

"If you look at our first quarter last year, people were saying that we had a lot of captive business," said William Grady, managing director and co-head of global ABS at Salomon.

Last year a hefty chunk of the bank's first quarter business could be attributed to a $4 billion stranded cost deal with PECO Energy Co., and the credit card business generated by the affiliation with CitiBank.

"We've had no benefit from any of that this time around," Grady said.

This year, as well as repeat business from issuers such as DaimlerChrysler AG, Greenpoint Financial Corp., Centex Corp., Countrywide, and Case New Holland, Salomon added a few new faces to its quiver of clients, including Huntington National Bank, an auto issuer that hadn't done a deal since 1988.

As a co-lead with Royal Bank of Scotland, Salomon worked on the Arran One transaction, which was backed by credit cards issued in the U.K. Grady anticipates growth in products backed by non-U.S. collateral, especially on the mortgage side.

"We think that will be an interesting alternative asset for US investors," Grady said. "We're right in the middle of it. We're going to see transactions in the next quarter that I think will prove it."

The Search for No. 1

CSFB and Lehman Brothers brought to market $5.9 billion and $5.6 billion in business respectively, for the second and third place seats.

Whether or not CSFB will lose any of last year's business to Deutsche - where its former senior management went - or to any of the top five banks such as Salomon, Lehman or Morgan Stanley Dean Witter remains a hot topic of debate.

"As you're looking at some of the firms that have had a significant amount of movement, there are holes and there are questions about the ability to deliver," said a spokesman for Lehman Brothers. "Hopefully issuers will see that also."

As for the business Deutsche will gain following the hire of Jorge Calderon, Phil Weingord and a whole crew of ex-CSFB players including, most recently, research head Karen Weaver, the real question is, "What does your pipeline look like, Deutsche Bank?"

Despite some market speculation, newly hired Co-Head Joseph Donovan sees CSFB as stronger than ever.

"I think it's clear that we are already above the level in home-equity expertise that this firm had in the past, and we are at or above the level of auto expertise that this firm had in the past," Donovan said. "We have other slots to fill, but we've brought in other asset classes that this firm has never dabbled in. Across the board, we'll be stronger."

Donovan added that, with the addition of Greg Richter and Jim Regan, and the retention of Ted Moran, CSFB is significantly stronger on the trading side.

"Do I predict we'll end up number one for the year? I think it's a little early, and a little bold to make that statement," Donovan said. "We intend be the number one firm in each asset segment that we target to compete in."

Privates and Rule 144A

Outside the public arena, No.1 manager Morgan Stanley Dean Witter had a strong showing at $2.4 billion, a significant spread over the second place bank Prudential Securities, which came in at approximately $700 million.

"We are at the top of the 144A league table," said Gail McDonnell managing director of ABS at Morgan Stanley. "However the 144A sector is running at just 40% of 1999 first quarter."

Additionally, collateralized debt obligation issuance was down to 20% of what it was last year in the first quarter.

"This reflects a lot of things, but primarily the arbitrage that's usually gained for the fund manager just hasn't been as significant," McDonnell said. "However we do expect market volume to pick up."

Despite the market slowdown in collateralized bond obligations and collateralized loan obligations, Morgan Stanley increased its volume in the 144A market by nearly $600 million, according to preliminary figures drawn by TFSD.

Approximately one-half of Morgan Stanley's 43% market share was attributable to the $1.3 billion MSAF-II aircraft lease transaction. Additionally, Morgan Stanley brought the $400 million Enterprise Mortgage Acceptance Corp., and two CBO/CLO transactions: the Emerald and Northwoods deals.

"Away from the CDO volume, we do expect there will be very good oportunities for interesting 144A transactions," McDonnell said. "Usually these transactions tend to be more strategic or corporate finance in nature. Investors have shown an interest in sitting down and doing their homework in order to capture incremental yield."

Though the 144A sector has slowed down this quarter in response overall market volatility, investor interest is still on the rise, players said.

"I think we've demonstrated this year and last year that we continue to be major player in the 144A segment of the market," McDonnell said. "It continues to be a priority sector for us, and our goal is to bring a variety of transactions to investors."

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