Citi and Bank of America Merrill Lynch continue to vie for the top underwriting position in the municipal bond industry, according to mid-year rankings from Thomson Reuters.

Citi — the top-ranked underwriter for each year of the past decade — maintained the top spot from January to June 2010 as it ran the books on 217 deals worth $29.24 billion to garner a 14.4% share of the market.

B of A Merrill was a tight second, senior managing 239 issues worth $28.98 billion for a 14.3% market share.

David Brownstein, managing director and co-head of public finance at Citi, said total municipal issuance is only 4% more than in 2009 so far, but he noted that the substance of the market has changed considerably. Thanks to Build America Bonds, taxable municipals comprised 33% of the issuance in the first half of 2010 versus 13% in the same period of 2009.

“We believe that our work developing a global investor base for municipals has strengthened our ability to best execute for our clients under this changing dynamic,” Brownstein said.

Since Bank of America merged with Merrill Lynch in January 2009, their competition with Citi has been intense.

Citi’s underwriting volume fell 7.4% this year from the same period of 2009, when it ­underwrote 199 issues worth $31.58 billion for a 16.2% slice of the market. By contrast, volume at B of A jumped 9.3% versus the same period last year, when it led 247 issues worth $26.52 billion.

The boost in volume trimmed Citi’s mid-year dominance from $5.06 billion in 2009 to just $263 million this year.

JPMorgan was the only other firm to take a double-digit share of the total market. It maintained the number-three position, serving as lead underwriter on 194 deals totaling $23.33 billion, or 11.5% of all issuance.

The mid-year rankings suggest that continued market volatility over the past year has done little damage to the top underwriters.

Together with Morgan Stanley, which led 158 deals worth $19.64 billion, the top four banks controlled 49.8% of the $203 billion issued from January to June. Thomson Reuters’ database Thursday showed mid-year volume up from the $200 billion figure it reported Wednesday.

The top eight positions among underwriters are unchanged from both mid-year and end-year 2009.

Bank of America enjoyed a slight edge in fiscal stimulus-related assets, including BABs, with 40 deals worth $7.96 billion in the first half of the year, while Citi led 49 deals totaling $7.90 billion.

As with total volume, the top four firms controlled nearly half of all such issuance, which over the last six months comprised $56 billion.

Recent notable movements include Siebert Brandford Shank & Co., a ­minority-owned firm that ranked 10th in the first six months of this year after emerging as the number-nine player in the first quarter.

It was lead underwriter on 26 issues worth $4 billion from January to June. Siebert’s business was tilted toward the first quarter of the year, when it led deals totaling more than $3 billion. In the second quarter, it led on issues totaling $912 million.

Siebert attained the top-10 ranking thanks to a number of large deals in the first quarter when its average issue size of $147 million exceeded Citi’s $134 million average and was nearly seven times the $21.8 million average for Morgan Keegan & Co., which ranks number eight.

De La Rosa & Co., a minority-owned investment bank solely focused in California, ramped up its performance with a 61.9% increase in volume the first six months of this year to finish 13th with issues totaling $2.46 billion. It became only the second minority-owned firm to finish a quarter in the top 10, according to data going back to 1990, with a 10th place showing in the April-to-June period.

Edward de la Rosa, the firm’s president, said a number of large deals and an upsurge in issuance across the state helped his firm see a spike in business.

“California is generally about a quarter of the national market,” he said. “There are huge numbers of investors that are oriented around California tax-exemption, and you’ll find that even BAB buyers tend to be departments of institutions that are big tax-exempt buyers.”

Alongside JPMorgan and Morgan Stanley, De La Rosa was one of three lead underwriters for a $2.97 billion issuance from the California Department of Water Resources in early May.

“We’re happy when our volume goes up, of course, but those large transactions go hand in hand with all of the city, redevelopment agency, school district, and housing deals that we do,” De La Rosa said. “It’s all a function of the fact that we focus on this California market.”

Next to Illinois — which floated $7.78 billion through 10 deals in the first two quarters — California was the single largest borrower with six issues running to $6.0 billion.

Statewide, California issuers came to market with $29.79 billion of debt from January to June. That’s far more than second-ranked New York, which issued $16.94 billion.

Among small deals of $10 million or less, Robert W. Baird & Co. took the top spot by volume and number of issues. The Milwaukee-based firm led 247 deals totaling $968.8 million, outpacing second-placed Morgan Keegan, which led 172 issues worth $822 million.

RBC Capital Markets, the top ­small-deal underwriter for 16 consecutive years through 2006, finished fourth with 131 issues worth $697.6 million. That is one position behind Roosevelt & Cross Inc., which led 201 issues totaling $743.1 million.

In rankings of financial advisers, Public Financial Management Inc. increased business volume and easily kept its first-place ranking, while the volume of business done by rival Public Resources Advisory Group tumbled precipitously.

PFM advised on 466 issues from January to June totaling $27.24 billion, marking a 14% increase from the same period last year and amassing a 17.1% market share.

PRAG advised on just 59 issues worth $14.1 billion, a 41% decline in volume from the same period of 2009. It was enough to maintain its second-place ranking, but its market share fell to 8.8% from 15.4% in the first two quarters of 2009.

Much of PFM’s dominance was related to the firm’s work on stimulus assets such as BABs. PFM advised on 92 such issues totaling $10.63 billion, or 22.6% of all possible deals. PRAG also took advantage of the new assets by advising on 20 issues worth $6.13 billion, a 13% portion of the market.

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