Going public is losing its appeal, as the number of initial public offerings has been cut nearly in half. "In past years, underwriters might...

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Going public is losing its appeal, as the number of initial public offerings has been cut nearly in half.

“In past years, underwriters might have brought IPOs out in environments like this,” says Scott Sweet, managing director of research firm IPO Boutique. “But they can’t damage their reputation.

“For the first time in my 35 years of following IPOs, I am seeing a fiduciary responsibility by the underwriters to not bring IPOs [to market] in this very dangerous environment.”

Through February, there have been 19 IPOs, mostly by special-purpose acquisition companies.

This is down 49 percent from 37 deals as of Feb. 28, 2007, according to Renaissance Capital’s IPOHome.com.

Proceeds have fallen 42 percent to $4.2 billion from $7.1 billion a year earlier. The Renaissance IPO Index, which tracks a rolling two-year population of IPOs starting from the first day of trading, is down 19.6 percent year to date. That’s more than the S&P 500 index’s 9.6 percent loss.

The slowdown in fee revenue could pinch investment banks. As of Feb. 19, the IPO backlog stood at $57 billion, compared with $68 billion at the end of January, according to a report by Bank of America Securities analyst Michael Hecht.

Citigroup (C) leads the backlog with $10.33 billion in deals. UBS (UBS) has $8.17 billion and JPMorgan Chase, (JPM) $7.5 billion.