View from City Road: Pat on the back for Warburg

By courtesy of the National Audit Office, SG Warburg at last has something to celebrate. This has been a humbling year for Britain's pre-eminent home grown investment bank. Abject failure in Enterprise's bid for Lasmo, plummeting profits, top of the flops in the new issues market, the list of disasters goes on and on.

Until yesterday, that is, when Sir John Bourn, head of the NAO, told Parliament that the sale of the Government's remaining shares in BT last year had, in terms of maximising proceeds, been one of the most successful to date. Warburg was much criticised at the time for using the US book building system and introducing apparently heavy-handed measures to prevent the price being manipulated down ahead of the sale. The result was that, for the first time in a secondary sale, the Government was able to sell its shares at the market price.

Warburg may have upset powerful investors by adopting such methods, but if serving the interests of the client - in this case the Government - is what investment banking is meant to be about, it is to be congratulated.