6.1.4. The Syndicate
Recall that when a corporation or municipality issues new securities, they engage an investment bank to sell and market the new securities. Usually, the underwriter will purchase the securities at a discount and sell them to the public at a public offering price. This In most cases, the underwriter selected by the issuer will not want to bear all the financial risk of the offering. For this reason, the underwriter will invite other investment banks to join in the underwriting. This group of underwriters is called “the syndicate.” Each member of it will be allotted a certain amount of shares that it will be responsible for selling. The underwriter that manages the underwriting has several different names. It might be called the lead underwrit
