SG Warburg has retained its crown as the City's top-rated research house for the fifth year running, but its recent troubles have clearly taken their toll.
Its margin of victory over second-rated NatWest Securities in the widely- regarded Extel survey of investment analysts has narrowed to less than 1 per cent and NatWest has established a clear lead in pure UK equity research.
The findings, published yesterday, also show Barclays de Zoete Wedd knocked from third to fourth position by James Capel, the broker that dominated the table throughout the 1980s, and Morgan Stanley, Warburg's jilted suitor in last year's takeover talks, creeping up into 10th place from the number 11 spot.
Otherwise the super league of analysts shows no change in the overall rankings of the City's top 10 investment houses, although votes for the top five continue to cluster ever closer together. The gap separating Warburg, which won 12.45 per cent of the votes cast last year, and fifth- ranked Kleinwort Benson at only 2.39 per cent, is less than half the 5.89 per cent margin between top and fifth places two years ago.
Geoffrey Osmint, consulting editor of the survey, forecast continuing shrinkage in the industry. Pointing out that the number of institutions using just five to 10 brokers had gone up from 38 to 46 per cent last year, he predicted a situation in which large-scale research becomes centred on five broadly-based houses and around six niche players.
NatWest reinforced its strong position by sweeping up the top accolades for both the best individual analyst and the best research team. Steve Plag, who covers pharmaceuticals, healthcare and household goods for the broker, moved up from ninth place to knock his colleague, the oil analyst Fergus MacLeod, into the number two spot after being voted most highly rated individual. Mr MacLeod and his team - followers of the integrated oil sector - had the consolation of taking the best team prize for the second year running.
Simon Flowers, another of NatWest's integrated oil team, took third place among individual analysts, with Jamie Stevenson of Kleinwort Benson's building team fourth.
Julia Blake and her colleagues who look at the textiles sector shot from fifth to second slot, with NatWest's oil exploration and production team, also led by Fergus MacLeod, in third place.
Mr Plag, 38, said: "We don't write pots of maintenance research here. We just look for value-added ideas. We have tried to break the mould a bit and I'm dead chuffed."