The deal-closing dinner is apparently on a diet.

A time-honored tradition on Wall Street, closing dinners have long been lavish affairs, best epitomized by the party Henry Kravis threw after winning control of RJR Nabisco. As immortalized in "Barbarians at the Gate," that fete, held at New York's Pierre Hotel, featured lobster, veal with morel sauce, a three-foot-high cake with replicas of Nabisco products and all the Dom Perignon you could drink.

But these days, there's not too much champagne flowing on Wall Street.

"It's very hard to be spending that kind of money when everyone is firing 10 to 15% of their work population, and having write-offs," says one banker. "In an era of cost cutting, it's considered a little tacky to expense something that opulent."

And inviting them to lunch is still considered one of the least-expensive ways to do that.

Indeed, dealmakers are still packing New York power-lunch spots like San Pietro, Fresco, Cipriani, Smith & Wollensky Steakhouse, Kobe Club and Lever House. "They won't skip lunch. They might not be closing deals, but they're talking deals," says Alex von Bidder, co-owner of The Four Seasons restaurant, which famously boasts Pete Peterson, Barry Diller, Sandy Weill and Robert Rubin among its lunchtime regulars.

One private equity executive reports receiving even more lunch invitations as more dealmakers engage in career management. "All these guys need references," he says. "If they're out on the street they may be looking for new jobs, or they need us for references or leads on new banks."

Still, New York's eateries are feeling Wall Street's pain. "Overall business is down, and less people are going out on the weekends," admits von Bidder. "But that goes in cycles just like deals go in cycles." The 21 Club sees "less entertaining at lunch, and fewer IPO launches," says spokeswoman Diana
Biederman. And the Waldorf Astoria's Bull and Bear Steakhouse and Bar has noticed a decrease in American corporate diners but an increase in Europeans taking advantage of the weak U.S. dollar.

To attract the more budget-conscious, some restaurants have turned to the prix fixe menu at both lunch and dinner. "A way to give perceived value and to drum up business in the economy is to do a less expensive dinner offering," says Mathew Glazier, president of the Glazier Group Inc., which owns the Strip House and Michael Jordan's steakhouses.

Power breakfasts are another alternative to more expensive midday meals, but not always. Norma's restaurant at Le Parker Meridien continues to feature its Zillion Dollar Frittata -- a blend of eggs and lobster topped with 10 ounces of Seruga caviar -- at $1,000 a pop. The restaurant also offers a scaled-down version -- only one ounce of caviar -- for $100. It currently sells about one dozen a week.

Not all dealmakers rely on posh meals when entertaining. Shelly Stein, vice chairman of Morgan Stanley's Dallas office, uses his four courtside seats to Dallas Mavericks basketball games. "I'm not someone that thinks eating at Le Cirque is important," Stein says. "I'm not getting business because I take people to a fancier restaurant. It's the personal."

Michael Stoler, a senior principal at Apollo Real Estate Advisors LP, offers a similar sentiment: "I don't do power breakfasts. I think they're ludicrous. People can come into my office, have a cup of coffee with me and they can do business."

Not surprisingly, Julian Niccolini, co-owner of The Four Seasons, does not agree. "It's very important to break bread," he says. "This is the most important thing under the English mentality. The only way you're going to make a deal in good and bad times is to go out with your friend or enemy."

His bottom line: "People need to eat."