How Facebook's bankers saved an IPO, kept shares above $38

Facebook's IPO was a roaring success -- for Facebook. Investors aren't quite sure what to make of it after Facebook's underwriters repeatedly stepped in to make sure shares didn't fall below the $38 mark.

The social networking giant priced its shares at $38 and raised about $16 billion in what was a perfect price. Facebook's IPO was perfectly priced because the company raised everything it could and left no premium for investors. An IPO is mispriced if it rockets to the moon and the company could have raised more. Facebook's IPO lacked fireworks, but raked in dough.

Its shares finished the trading day at $38.27, up 0.71 percent. So in other words, Facebook's IPO was a lot of hype for a gain of just a few pennies.

But the far more interesting endpoint to Facebook's IPO is that it needed help from its plunge protection team -- 33 underwriters determined to make sure the offering didn't break below the $38 price.

To understand how bankers supported the Facebook IPO, all you had to do is watch the Level II quotes -- a stock system designed to show you underlying bid and ask prices -- to see how millions of bids appeared every time Facebook hit $38.

Coincidence? Not quite. There weren't zillions of people waiting for Facebook shares at $38. But investment banks were unloading every bullet they had to keep FB at least treading water.

The Wall Street Journal reported that underwriters stepped up to protect Facebook shares. After all, no investment bank worth anything wanted the biggest tech IPO ever to break.

Now it's unclear how long Facebook's plunge protection team will be in place. Investment banks avoided an embarrassing first day break of Facebook shares, but Monday could be a different story.

Here's the day in Facebook shares.