Call it the deal-less recovery.

Despite an uptick in stock offerings, investment banks with strong ties to Minnesota advised a paltry 29 mergers and acquisitions in the third quarter, only two more than the previous three months, according to the Star Tribune Quarterly Deals Report.

For the first nine months of 2009, local banks managed 86 M&A deals, down 52 percent from the same period a year ago. RBC Capital Markets, normally a prolific deal maker, reported no mergers and acquisitions in the quarter.

Minnesota's stagnation mirrors the nation's: 1,679 deals in the third quarter, two fewer than the second quarter, according to Dealogic. So far this year, the country's investment banks collectively advised 5,217 mergers and acquisitions, a 22 percent drop from the first three quarters in 2008.

The dearth of deals suggests, despite early signs of an economic recovery, companies still can't access credit.

"The institutional [credit] market is locked up, not available," said Jon Salveson, head of investment banking for Piper Jaffray & Cos. in Minneapolis. "Acquisitions are still quite tough."

Still, Salveson sounded upbeat: Initial public offerings (IPOs) are showing signs of life, thanks to a surge in the stock market. Since early July, the Dow Jones industrial average jumped 22.4 percent to close Friday at 9,972.18, while the S&P 500 index rose 23 percent to close at 1,079.60.

Minnesota banks' IPO output this year (15) already matches all of 2008. Nationally, banks underwrote 13 IPOs in the third quarter alone -- more than the previous two quarters combined.

"The pace is quickening," Salveson said. "The fourth quarter will be even better. It could even get back to normalized levels."

Piper Jaffray helped underwrite the $931.5 billion IPO of Starwood Property Trust Inc., a real estate investment firm in Greenwich, Conn., and the $422.5 million debut of Emdeon Inc., a health care software developer based in Nashville.