Salomon Brothers has raised $1.1 billion worth of commitments for its loan fund, exceeding the $850 million it had originally sought.
Five U.S. banks and six foreign banks each committed $100 million to the fund, which was announced three weeks ago. Salomon, which plans to provide $150 million of its own equity to the fund, said it is considering increasing the size of the fund.
Salomon is the latest of the bulge-bracket firms to add loan underwriting to its menu of corporate finance services.
"The firm has terrific high-yield, mergers-and-acquisition, and equity businesses, and now we want to build up our capability on the banking side," said Richard Ivers, managing director and head of the lending group.
Banks that have committed to the fund include Bankers Trust New York Corp., Bank of New York Corp., Citicorp, and Wells Fargo & Co. Participating banks are set to receive one-eighth of their commitments in up-front fees and share fees reaped from loans equally with Salomon.
The investment bank landed its first lending assignment with Sinter Metals Inc. in October, leading a $275 million loan backing its acquisition of two units of Maag Holding AG. Ron G. Campbell, assistant treasurer of Sinter, said the investment bank has done a good job serving his company's financing needs.
"The ability to act at one time in the midst of heavy negotiation gave Solly a leg up," said Mr. Campbell, who worked in Citicorp's leveraged lending group with Mr. Ivers.