As syndicated lenders digest yearend volume numbers, a new debate is raging about which bank is No. 1.

In one corner: the leader by dollar volume, Chase Manhattan Corp., which led $271 billion worth of deals. In the other: the leader by number of loans, BankAmerica Corp., which led 682 deals.

The rankings are important to top firms, which use their "leading" status to attract borrowers who want an experienced and well-regarded bank doing their deals. The tables also are used by senior management to determine budgets, as well as banker bonuses.

For years, the No. 1 spot has gone uncontested to Chase or one of its predecessor banks. But when the former No. 3 lender, San Francisco-based BankAmerica Corp., merged with No. 5, Charlotte, N.C.-based NationsBank Corp., the picture turned fuzzy.

Securities Data Co., one of two companies that compile loan-market statistics, consolidated the merging banks' activities for the year. The result, according to the firm's head loan analyst, Jasmin Chanana, was a first.

"To be honest, we've never had a problem like this, where one lender had larger deals and another did more deals," Mr. Chanana said.

On Jan. 13, a day after the numbers were released, Chase rankled loan executives with a two-page advertisement in The Wall Street Journal trumpeting its 26.8% market share. It also cited four industry awards given to the bank by trade publications and quoted an American Banker article that cited Chase's No. 1 spot on the 1998 lending league tables.

However, the ad did not say that Chase's share slipped from 1997, when it had 29.8% of the market. Nor did it mention that BankAmerica displaces Chase as the No. 1 lender when volume is calculated on an "agent-only," rather than book- or lead-manager, basis. Agent-only tables credit not only book managers, but lenders with lead roles on a syndicated loan.

The ad was the brainchild of James B. Lee Jr., vice chairman and head of global investment banking at Chase, who said he wanted to tout Chase's market leading position and attract the attention of corporate chief executives.

Still, many inferred from the ad that Chase is No. 1.

Stacy Cook, a managing director with BankAmerica's loan syndication group in New York, declined to comment on the ad. But she did say that having a greater number of syndicated deals shows BankAmerica's extensive corporate relationships.

Ms. Cook said that when measured by dollar volume, a bank could become No. 1 by syndicating billion-dollar deals for a low-risk, blue-chip client list. That activity consists of "mailing standard term sheets" to borrowers-not presenting an "innovative strategy," she said.

"Every time we do a deal, a company decides that we're the best bank to do their deal," said BankAmerica loan analyst Michael D. Rushmore.

Ms. Cook added, "The bank that has the higher number of deals is in front of the investor community that many more times."

So if BankAmerica is leading so many deals, why don't they have more dollar volume? The answer is customers. Chase's blue-chip client list generated an average $511 million loan in 1998, compared with BankAmerica's middle-market clients, which took loans averaging $254 million.

Mr. Lee cites the cost-effectiveness of doing a $2.5 billion loan, rather than 10 of $250 million each.

"There's a reason why firms go manic about winning large-size deals," Mr. Lee said "It's that the fees are outsized relative to the resources required for smaller deals. You have to do the big deals, and you have to be leading them."

As for Chase's claim on the No. 1 position, Mr. Lee said, "Our clients have placed us in this position for a sustained period of time."

Mr. Lee said ranking lenders by dollar volume is more akin to the way players in other capital markets are ranked. For instance, managers of stock and bond offerings are ranked by volume-not number of deals.

The argument that the number of deals is more important than the size of a deal is "not good for the industry," Mr. Lee said.

All of this has become somewhat of a nightmare for Mr. Chanana, who is trying to remain impartial in the debate while producing the most accurate measure of loan volume.

"Both tables are equally important," he said.

But Mr. Chanana did say that league tables have traditionally ranked lenders by dollar volume. It was only at the end of 1998 that Securities Data decided to release a separate table ranking lenders by number of deals-a move urged by BankAmerica.

It wasn't the first time Securities Data changed its policy after a major lender's campaign. Two years ago, Mr. Lee and other Chase executives began meeting regularly with Mr. Chanana to push for a change in the way loan statistics are gathered.

Their hopes were satisfied over the summer when Securities Data unveiled its "book manager" table, which gives credit to the bank that manages, structures, and prices a syndicated loan.

Until the change, the industry had been judged by "agent only" rankings.

The difference between the two tables is dramatic. As a book manager, Chase leads BankAmerica. As an agent, BankAmerica has a narrow lead over Chase.

Mr. Chanana said Securities Data made the decision to make the book- manager its main lending table after much study and polling of lenders, borrowers, and investors of bank loans. The agent-only table is still compiled.

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