You've got to remember that Investment Banks have two sets of customers -> the big investors who they want to please and their corporate clients who want to sel

You've got to remember that Investment Banks have two sets of customers -> the big investors who they want to please and their corporate clients who want to sell shares. In recent times the big investors have become massively more powerful than anyone else, private equity hasn't had a crash like banking has. In recent times a safe bet for the banks has been to underprice the IPO so that their big investor clients make lots of profit in the first couple of days, and then to weather the storm of the disappointed public company. The newly public company won't actually do as much future business with the bank as the big investors will.