||In Taiwan, the initial public offerings (hereafter IPOs) market is growing mature. Especially in 2005, it is the turning point of the regulations for IPOs. The FSC plans to achieve four main goals by implementing the new underwriting system. (1) Making the underwriting price more reasonable (2) Increasing the stability of price of a listing stock (3) Increasing the underwriter’s independence in distribution stocks. (4) Enforcing the professional ability of underwriters. Most importantly, it puts the emphasis on the ability of underwriters that involve in the quality for IPOs. This paper compares the IPO market performance between new underwriting system and old underwriting system, and collects the data from 2001 to 2009 about IPOs companies’ related information to figure out the IPO market valuation and profits for underwriters. Finally, this paper finds out that: first one is, in the new underwriting system, the market valuation is more affected by investors’ optimum growth forecast than old underwriting system. In the aspect of the rewards for underwriters, the difference between new underwriting system and old underwriting one is cancelling self-subscription method in new underwriting system. Therefore, the underwriter can’t gain the underwriter proceeds from that; the issuer should make up them by giving more underwriter’s fee which depends on the performance of underwriters. In conclusion, the professional underwriters play an important role in new regulation system.|
Keywords: IPOs, underwriter regulation, underwriter, market value, underwriter proceeds
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