Smaller underwriting firms and investment banks looking to increase their presence in New Jersey will have the opportunity to work on more Garden State bond and note deals.

The Treasury Department Friday released its selection for senior managers and senior co-managers, and will announce its new co-manager group and selling team "in the near future."

The book-running pool includes Barclays Capital, Citi, Goldman, Sachs & Co., JPMorgan, Jefferies & Co., Bank of America-Merrill Lynch, Morgan Keegan & Co., Morgan Stanley, RBC Capital Markets, and Wachovia Bank NA.

New Jersey's prior senior team included Goldman, Merrill, and Morgan Stanley. Bear Stearns & Co. and UBS Securities LLC, which have now left the business, were also on the list.

Expanding the state's senior management team to 10 firms from the five banks it selected in 2006 brought new names to the book-runner pool and new opportunities for banks seeking more New Jersey business.

For example, Barclays, which last year acquired Lehman Brothers' municipal finance business, failed to make the list of the top 25 senior managers of New Jersey debt in 2008 or during the first six month of 2009, according to Thomson Reuters. That may change in the future as it now sits in New Jersey's top pool.

In addition, Jefferies, which purchased First Albany Capital Inc. in March, can now begin serving as senior manager of New Jersey bonds and notes, a position it previously did not hold.

Ken Gibbs, president of municipal securities group at Jefferies, said the firm has been hiring and building banking to increase its municipal finance business.

"We've been in deals working with the state before, but in terms of having the opportunity to run the books, this is an important opportunity for us and we certainly look forward to serving the state," Gibbs said.

Morgan Keegan placed 23rd among senior managers of New Jersey debt in 2008, working on four issues totaling $31.4 million, or 0.3% of market share. Morgan Stanley, Wachovia, and RBC served as book-runners on $664.1 million, $483 million, and $295.7 million, respectively, of state debt in 2008.

New Jersey's new senior co-manager pool includes BB&T Capital Markets, PNC Capital Markets, Raymond James & Associates Inc., Siebert Brandford Shank & Co., and Stifel Nicolaus & Co. Previously, the state did not have a senior co-manager team.

BB&T, Siebert, and Stifel did not break into the list of the top 25 book-runners for New Jersey in 2008. PNC and Raymond James served as senior manager on $273.4 million and $78.7 million, respectively, of New Jersey debt last year.

Frank Oh, senior vice president at Stifel, believes the firm's expanded distribution services helped secure its place in the senior co-manager team.

"I think they were looking at our overall distribution capabilities, which because of our acquisition in 2007 of Ryan Beck, we have a huge distribution presence in New Jersey," Oh said.

Contracts extend for one year and the state may opt to renew agreements via two one-year extensions.

Selected firms will work on bonds and notes issued by New Jersey and also debt sold through independent authorities and agencies in which the state pledges its obligation to the repayment of the debt.

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