Investment Banker Blamed in IPO

Investment banking can be a real boys’ club—until one of the boys makes a dud call. That may be the case with 45-year-old Morgan Stanley banker Michael Grimes, who’s catching a lot of flak for Facebook’s fraught initial public offering. Morgan Stanley was lead underwriter on the deal, and with the social network’s share now tumbling to 16 percent below its IPO price, the relationship that developed between Grimes and Facebook’s chief financial officer, David Ebersman, is getting a second look. Grimes reportedly encouraged Ebersman to jack Facebook’s share price to $38 as well as to make more shares available in the initial offering. Analysts have said that underwriters on the Facebook deal allowed themselves to get carried away by hype.