Touted as one of the biggest IPOs in over a decade, Facebook's stock sale of about $10 billion is expected to take place in early 2012.
With the California company planning to file offer documents in early 2012, a decision on bankers "could be soon", a report in The Wall Street Journal said.
Goldman and Morgan Stanley are "considered front-runners" for the lead investment-banking role, which could net the bankers anywhere up to $220 million in IPO fees as well as "bragging rights" for managing the trophy IPO.
The fee for IPOs like Facebook's stock sale which could be as big as $10 billion, valuing the company at $100 billion -- averages 2.2 per cent.
"That would mean a possible total payoff of as much as $220 million, though the company could negotiate lower fees because the Facebook deal is such a trophy," The Wall Street Journal report said.
The report quoted people in-the-know as saying that some bankers have been "waiting by the phone" over the holidays for the call that they will be participating in the company's IPO in some way.
Facebook executives have been meeting with Wall Street firms since late November as they geared up for the IPO, according to people familiar with the situation.
"Goldman and Morgan face stiff competition from rival investment banks vying for the prize of becoming the lead manager. Still, both are seen as having a leg up on competitors, even though each has possible knocks against them," the report added.
While Goldman orchestrated a $1.5 billion private offering of Facebook shares in January, Morgan Stanley has been the leading bank for internet IPOs this year in the US and worldwide.
The report said Goldman Chairman and Chief Executive Lloyd Blankfein "went to woo" at least one Facebook board member earlier this fall.
Goldman, however, had to prove itself to Facebook after a little blunder 11 months ago in which Goldman had to restructure a private-placement deal that nearly ran afoul of US securities laws that restrict advertising of private placements.
While Goldman solved the problem by limiting the offering to non-US investors, executives at the social networking company became "less enamoured with the bank," according to people familiar with the matter.
Morgan Stanley played the "lead left" role in the IPO of games site Zynga.
The "lead of the leads" status imbues the bank with the most authority on a deal, but also subjects that firm to the most criticism if things go wrong in an offering, the Wall Street Journal said.
With Zynga shares mostly trading below their offer price since the IPO, some bankers feel that could hurt Morgan Stanley's chances in winning the Facebook deal.
According to Dealogic, a firm that tracks new issues, Goldman and Morgan Stanley are "running neck-and-neck" for the number one title in underwriting the most US-listed IPOs for 2011.
"The prize role on Facebook could put the winner ahead of competitors in an area that has proven to be one of Wall Street's bright spots amid relentless pressure on profits," The WSJ report said.