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First Boston
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First Boston
The First Boston Corporation was a New York–based bulge bracket investment bank, founded in 1932 and acquired by Credit Suisse in 1988. After the acquisition, it operated as an independent investment bank known as CS First Boston until 2006, when the company was fully integrated into Credit Suisse. In 2022, Credit Suisse revived the "First Boston" brand as part of an effort to spin out the business.
The First Boston Corporation was formed in Boston, Massachusetts, on June 27, 1932, as the investment banking arm of the First National Bank of Boston. It became an independent firm after passage of the Glass–Steagall Act, a New Deal banking legislation that required commercial banks to divest securities businesses following the 1929 stock market crash. During this time, the company became the largest publicly owned investment banking firm in the United States. First National Bank of Boston continued as a commercial bank, eventually becoming part of Bank of America. The early First Boston investment bank had been assembled from the investment banking arms of major commercial banks. For example, several key members of Chase Harris Forbes Corporation, the securities affiliate of Chase National Bank, joined the new investment bank in 1934.
In 1946, Mellon Securities Corporation, the former investment banking arm of Mellon Bank, merged into the First Boston. Mellon's franchise with industrial and governmental clients led to some major deals: initial public debt offerings for the World Bank and Hydro-Québec, and a share offering for Gulf Oil Corporation in 1948 (the largest IPO to date).
By 1947, the First Boston surpassed $1 billion in new capital issues, and in 1959 it reintroduced the credit of Japan to the American markets with the first offerings by its government since 1930.
As of 1970, First Boston was considered to be part of the bulge bracket along with Morgan Stanley, Dillon Read and Kuhn Loeb.
By 1970, the Firm was raising more than $10 billion in new capital annually for underwriting clients. In 1971, The First Boston Corporation listed on the New York Stock Exchange developed its equity, sales, research, and trading operations. In 1978, First Boston began its highly successful London operations in partnership with Credit Suisse (see "Relationship with Credit Suisse" below) and became a leading Eurobond trader and underwriter.
Credit Suisse's relationship with First Boston began in 1978, when White Weld & Co. was bought by Merrill Lynch. As a result, White Weld dropped out of its London-based investment banking partnership with Credit Suisse. First Boston stepped in, creating Financière Crédit Suisse-First Boston, a 50-50 joint venture widely known as Credit Suisse First Boston. First Boston was not Credit Suisse's first choice for the partnership. When White Weld stepped out, Credit Suisse had unsuccessfully approached Dillon Read, which a couple decades later was acquired by Swiss Bank Corporation, to form the core of that firm's U.S. investment banking business. Swiss Bank Corporation itself subsequently merged with Credit Suisse archrival Union Bank of Switzerland to form UBS AG.
First Boston sat at the top of merger and acquisition league tables in the 1980s, thanks to the team led by Bruce Wasserstein and Joseph Perella, which orchestrated such transactions as the leveraged buyout of Federated Stores, which earned First Boston $200 million in fees, and Texaco's hostile takeover of Getty Oil. A 1985 Fortune Magazine article called First Boston "the archetypal deal factory", a year in which it did $60 billion in M&A deals placing it second after Goldman Sachs. In 1986, First Boston recorded $100 million in securities trading losses.
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First Boston
The First Boston Corporation was a New York–based bulge bracket investment bank, founded in 1932 and acquired by Credit Suisse in 1988. After the acquisition, it operated as an independent investment bank known as CS First Boston until 2006, when the company was fully integrated into Credit Suisse. In 2022, Credit Suisse revived the "First Boston" brand as part of an effort to spin out the business.
The First Boston Corporation was formed in Boston, Massachusetts, on June 27, 1932, as the investment banking arm of the First National Bank of Boston. It became an independent firm after passage of the Glass–Steagall Act, a New Deal banking legislation that required commercial banks to divest securities businesses following the 1929 stock market crash. During this time, the company became the largest publicly owned investment banking firm in the United States. First National Bank of Boston continued as a commercial bank, eventually becoming part of Bank of America. The early First Boston investment bank had been assembled from the investment banking arms of major commercial banks. For example, several key members of Chase Harris Forbes Corporation, the securities affiliate of Chase National Bank, joined the new investment bank in 1934.
In 1946, Mellon Securities Corporation, the former investment banking arm of Mellon Bank, merged into the First Boston. Mellon's franchise with industrial and governmental clients led to some major deals: initial public debt offerings for the World Bank and Hydro-Québec, and a share offering for Gulf Oil Corporation in 1948 (the largest IPO to date).
By 1947, the First Boston surpassed $1 billion in new capital issues, and in 1959 it reintroduced the credit of Japan to the American markets with the first offerings by its government since 1930.
As of 1970, First Boston was considered to be part of the bulge bracket along with Morgan Stanley, Dillon Read and Kuhn Loeb.
By 1970, the Firm was raising more than $10 billion in new capital annually for underwriting clients. In 1971, The First Boston Corporation listed on the New York Stock Exchange developed its equity, sales, research, and trading operations. In 1978, First Boston began its highly successful London operations in partnership with Credit Suisse (see "Relationship with Credit Suisse" below) and became a leading Eurobond trader and underwriter.
Credit Suisse's relationship with First Boston began in 1978, when White Weld & Co. was bought by Merrill Lynch. As a result, White Weld dropped out of its London-based investment banking partnership with Credit Suisse. First Boston stepped in, creating Financière Crédit Suisse-First Boston, a 50-50 joint venture widely known as Credit Suisse First Boston. First Boston was not Credit Suisse's first choice for the partnership. When White Weld stepped out, Credit Suisse had unsuccessfully approached Dillon Read, which a couple decades later was acquired by Swiss Bank Corporation, to form the core of that firm's U.S. investment banking business. Swiss Bank Corporation itself subsequently merged with Credit Suisse archrival Union Bank of Switzerland to form UBS AG.
First Boston sat at the top of merger and acquisition league tables in the 1980s, thanks to the team led by Bruce Wasserstein and Joseph Perella, which orchestrated such transactions as the leveraged buyout of Federated Stores, which earned First Boston $200 million in fees, and Texaco's hostile takeover of Getty Oil. A 1985 Fortune Magazine article called First Boston "the archetypal deal factory", a year in which it did $60 billion in M&A deals placing it second after Goldman Sachs. In 1986, First Boston recorded $100 million in securities trading losses.