Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Devin Ryan – Sandler O'Neill
Devin Ryan – Sandler O'Neill
Most of your banking activity, as you said, has been in the metals and mining space. Are we at a point yet where this recent equity market rally has started to create some activity, maybe behind the scenes, or client conversations that may lead to M&A or financing opportunities in some of your other sectors?
Thomas W. Weisel
There's a little glimmer of hope. Who knows if it's the end of the tunnel or a train coming at you. But the IPO market has had a couple of education deals. We are a co-manager on a software company called Solar Winds that anticipates going on the road soon, and there are a couple of other software deals that we are aware of that should be coming and testing the market here in the IPO world in the next month or two.
And so given the very large uptick in secondaries of established companies in a myriad of industries, we do think that the capital markets are slowly coming back.
On the M&A front, while you haven't seen a tremendous amount of increase in announced deals, you have seen enough from the Oracles and Ciscos of the world, who have both announced deals in the last several weeks to see that larger companies are engaged in a much higher level of dialogue and we are definitely seeing that on both the buy and the sell side.
Now whether or not that results in actual transactions, I think it's way too early to tell. But certainly the business right now feels slightly better than it did in January.
Devin Ryan – Sandler O'Neill
And on the expenses, is the non-comp level from this quarter, excluding that fraudulent trade, about where it should be or do you see any more potential savings there?
And just in terms of the comp ratio, should we really just be thinking about compensation on an absolute level, just kind of given that $50.0 million break-even target?
Shaugn S. Stanley
Yes, with respect to non-comp we are right on track with where we had hoped to be when we put together the plan for 2009. So excluding the fraudulent client loss, we would have come right in on track with that.
With respect to comp, yes, I think it's fair to say our compensation model is built around this kind of $50.0 million break-even assumption and if we come in with revenues below that we will have a higher comp ratio that what we had projected.
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