The Evaluation Of IPO Underwriters' Reputation

In the processing of Initial Public Offerings, underwriters play an important role as financial intermediaries to solve the information asymmetry problems between firms and investors who provide the financing. However, security underwriters face creditability problem as "information producer". Thereby, reputation is indispensable for underwriter in order to solve creditability problem and to win investor's fidelity.How to evaluate underwriters' reputation is a very important and complex problem. The forepassed researches mostly simplify the problem, use single index to evaluate underwriters' reputation. Considering the complexity of the reputation's influencing factors, the dissertation is ready to use a multi-index system to evaluate the underwriters' reputation, which based on the PCA comprehensive evaluation method.At the beginning, the article analyzed the functions and influencing factors to underwriters and the reputation, and took some discussion about the new-stock offering and underwriting market in china. Subsequently, we analyzed the comprehensive evaluation method based on principal component analysis. At last, we evaluated the underwriters' reputation by two stages, and got the evaluation method that fits our present requirement.