Welcome to the Piper Jaffray's Companies Conference Call to discuss the Financial Results for the First Quarter of 2015. During the question and answer session, security industry professionals may ask questions of management. The company has asked that I remind you that statements on this call that are not historical or current facts including statements about the beliefs and expectations are forward-looking statements that involve inherent risk and uncertainties. Factors that to cause actual results to differ materially from those anticipated or identified in the company's earnings release and report on file with the SEC which are available on the company's website at www.piperjaffray.com and on the SEC website at www.sec.gov. This call also includes statements including non-GAAP financial measures. Please refer to the company's earnings release issued today for a reconciliation of these non-GAAP financial measures to the most comparable GAAP measure. The earnings release is available on the investors relations page of the company's website or at the SEC website. As a reminder, this call is being recorded. And now I would like to turn the call over to Mr. Andrew Duff. Mr. Duff, you may begin your call.

Good morning and thank you for joining us to review our first quarter results. On our call this morning, I will spend a few minutes discussing the markets and performance of our various businesses during the quarter, followed by Deb's review of the financial results before we get into your questions. Our results in the first quarter represented a solid start to the year with net revenues up sequentially and slightly below a strong first quarter last year. Inclusive of this quarters' results, we generated a return on equity of 7.8% over the last 12 months and a return on tangible equity of 11.2% during this same period. Our diverse mix of businesses continues to produce stable returns as we have generated a return on tangible equity close to or better than, 11% on a rolling LTM basis for five consecutive quarters. Market conditions were varied during the quarter ranging from accommodative for capital raising, mixed for advisory and challenging for our trading activities. I will address each of these together with the impact on our results starting with capital raising. Equity capital raising and public finance each got off to a strong start this year. A healthy investor appetite for equity offerings was particularly evident in the level of investor demand for secondary offerings, mostly from large cap issuers. Relative to our target markets, companies with market caps under $2 billion, we experienced robust demand to invest in healthcare companies. This played to our strength given our leadership in the healthcare sector. Capital was readily available for both our med tech and biotech clients. We're book runner on 62% of our offerings this quarter, evidence of our strength in these healthcare sectors. Our public finance clients also benefited from opportunistic market conditions during the quarter. Interest rates remained generally…

Thank you, Andrew. My remarks on our quarterly results will be based on the non-GAAP financial measures we referred to at the start of the call. For the first quarter, on an adjusted basis, we recorded net income of their $19 million or drawn $1.14 per diluted common share. We produced a solid operating margin 19% for the current quarter, an improvement of 300 bases points over the sequential quarter due to higher revenues and consistent with the year ago period despite lower revenues. The diversity of our business minimized variability in our base of revenues. Adjusted net revenues increased 5% compared to the sequential quarter due to strong capital raising in our equity and debt businesses and higher investment income. These favorable results were partially offset by lower revenues and advisory services in our trading activities. Revenues were down 4% compared to the first quarter of 2014 primarily due to stronger performance by our debt business that was more than offset by lower advisory and institutional brokerage revenue. Our results for the quarter demonstrate the breadth and diversity of our banking franchise as a strong quarter for capital raising was offset by a slower start to our advisory business whereas in previous periods advisory services was strong while capital raising was weaker. Andrew already provided color on the markets and the impact to our revenues during his remarks so I'll turn to our non-interest expenses for the quarter. Adjusted compensation and benefits expenses were 60.7% of adjusted net revenues for the quarter compared to 61.6% for the full year in 2014 and in line with our target range of 60% to 62%. The compensation ratio for the quarter compared favorably due to the mix of business. Adjusted non-compensation expenses were $32 million, in line with both the first and…

[Operator Instructions]. Your first question comes from the line of Douglas Sipkin.

This is Justin Therrien calling in for Doug. Just a first question, just noticed a very good quarter in debt financing. As well, some investment income gains from the merchant banking fund and the Muni fund. Just trying to get an idea of how much of an impact Muni's had here and what your outlook is for the Muni market this year and do you think it could be a tail wind for the overall business in 2015?

A couple thoughts on the municipal market. It was a strong quarter for issuance and we participated very well in that. A little over a hundred billion in the quarter. If you annualize that, it would be a very strong year. Last year I think it was 330. It does continue to be very active. Obviously, interest rates can have an impact on that. But it looks to us like it's going to be a favorable year for issuance and the breadth and depth of our franchise is in a very good position.

Okay. And then just one last question around just around the buy-back. I know you had said you bought back this quarter for dilution purposes. This is the first quarter you've bought back in a while. I'm just trying to figure out if this is really around the dilution or is it a bigger focus on returning capital this year?

Yes, I would say it is really both. We do view buy-backs an as effective way to return capital to our shareholders and we did more than-off set the dilution. As we look forward, we remain open to additional buy-backs but consistent with our historical practice, there are a number of factors that we will take into consideration when looking at that. Obviously including the impact to our EPS, impact of tangible book value per share. Also looking at just the level of ongoing capital appreciation that we have on our return on equity and then, of course looking at other capital deployment opportunities that are available to us.

Your next question comes from the line of Hugh Miller of Macquarie.

So I had a question you guys had mentioned kind of the expenses coming in a bit lighter than what we were looking for and I think you mentioned it was a function of timing. Should we then anticipate that the guidance range that you give should probably be towards the higher end of that range in future quarters just given kind of the catch-up? Or are there costs that you guys are seeing that you're able to take out of the business?

Well, it's a combination of both of those. I do think your first statement was accurate that some of those expenses will move to the other quarters and, again it's not at a perfect science and obviously the expenses do move around based on business activities somewhat, but I think your assessment that some of those expenses will move is a fair statement.

Okay. And you gave us a little bit of color on kind of the outlook for public finance and I think you mentioned as well that some of the rate volatility had benefited from refinancing activity in the quarter. And you mentioned that you anticipate that should be strong going forward. But what is kind of, do you see as the drivers of that demand in future quarters? Do you anticipate the volatility will kind of remain elevated or are there other things that are kind of driving that?

Well, we do think with the interest rate uncertainty there's likely to be some volatility. But part of it is refunding and also some of it is new issuance demand in particular some of our investments in public finance in the last couple years have been both in senior living and charter school capabilities and building a national franchise and just demographic trends and demands for capital there are quite positive.

Okay. And you gave some color with regards to the AUM flow difference. I wasn't quite sure if that was specific to MLPs or the AUM for the asset management business as whole. Can you just give us a little color what you're seeing between the MLP product and the equity funds?

Yes, so that was a comment overall. We continue to see inflows into our MLP product and I think as I mentioned not only has it performed well, it's outperformed its benchmark quite consistently. And with the correction in that marketplace with energy prices and the end of last year, the yield's pretty attractive. The four equity products are performing against their benchmark but I think it's fair to say value products in general have had less demand in the last couple years and at times our performance has dragged. So we have modest outflows there against the inflows that have continued in MLPs.

The last question I had at the end, I didn't catch all of it but you were talking a little bit about how you're viewing risk management with some of the natural liquidity providers and the potential for some capital restrictions. Can you just delve into that a little bit more and tell us how you're viewing it and how you're positioning the company?

Sure. Just as we look at the fixed income markets and see some reduction in liquidity out in the marketplace, we're just being more conservative as we actually were mostly we were throughout most of 2014 but I would say looking to further reduce inventory levels and paying attention to our hedging and our turnover. Just to give you a sense of what we're doing there, the interest rate component of the VAR, the value at risk calculation was down 30% compared to where were at yearend. Just really being cautious.

Okay. And so I guess given that, should we anticipate then that some of the flow business might see some pressure? Obviously you have some demand on the underwriting side but on the fixed income trading side given that position that we're likely to maybe see some challenges there?

Yes, we're of the mind that the flow business might be relatively tepid until you see some clear direction on interest rates which has certainly been a challenge the last couple of quarters.

[Operator Instructions]. And there are no audio questions registered at this time.

Thank you very much. Appreciate everyone's attendance and we'll look forward to updating you on our second quarter. Thank you, operator.