People: Three axed over JP Morgan trading losses

CIO traders leave JP Morgan - the bank also creates new division, reshuffling top management; Deutsche hires Houari from Barclays; deputy fixed-income head leaves Nomura; new hedge fund hires top quant; Citi boost credit sales and trading

people and processes

The fallout from the losses in JP Morgan’s chief investment office (CIO) continues, with three of the unit’s traders – Bruno Iksil, Achilles Macris and Javier Martin-Artajo – leaving the bank.

The departure of Macris, European head of the CIO, Martin-Artajo, a manager in the unit, and Iksil, who reported to both as a senior trader, had been expected since the losses came to light, but sources at the bank suggest this was delayed pending an internal review.

Under the watch of these three, the CIO made an apparent effort to reduce the unit’s risk-weighted asset consumption by adding new trades to the bank’s existing short credit position, rather than simply cutting the size of the hedge portfolio – a strategy JP Morgan chief executive Jamie Dimon has described as “flawed, complex, poorly reviewed, poorly executed and poorly monitored”. The bank first announced a $2 billion first-quarter loss on May 10. The loss more than doubled during the second quarter, to $4.4 billion, JP Morgan said on July 13.

There has been a reshuffle further up the hierarchy, too. Matt Zames, who took control of the CIO following the departure in May of its former head, Ina Drew, now adds the role of co-chief operating officer (COO), which he will share with Frank Bisignano.

In his COO role, the finance and regulatory affairs function will report to Zames, while the technology and operations, security and resiliency, real estate, procurement and general services departments will report to Bisignano.

And in a structural shake-up, JP Morgan announced that its investment bank, treasury and securities services and its corporate bank businesses will be combined into a new corporate and investment bank.

Jes Staley, chief executive of the investment bank, will become chairman of the new corporate and investment bank. The head of the treasury and securities service, Mike Cavanagh, will be co-chief executive of the new division, sharing the role with Daniel Pinto, chief executive for Europe, Middle East and Africa and head of global fixed income.

The combined business will cover two groups: banking, which includes investment banking, global corporate banking and treasury services; and markets and investor services, which covers fixed income, equities, commodities, prime services and securities clearing. Cavanagh will be responsible for the banking business, with Pinto taking on the markets and investor services side.

 

Antoine Cornut has left his position as head of European credit trading at Deutsche Bank and is said to be joining a hedge fund, according to sources close to the situation. Spokespeople at Deutsche Bank declined to comment on the matter.

Cornut’s departure is the second this year from Deutsche’s credit trading team, which won Risk’s credit derivatives house of the year award in January – the head of global credit trading, Colin Fan, was promoted to  co-head of corporate banking and securities and head of sales and trading at the firm in a general re-shuffle of senior management in April. Described by Fan as a ‘perma-bear’, Cornut played a key role in reducing Deutsche Bank’s sovereign credit exposure by more than a third, allowing the firm to extend liquidity to clients when eurozone fears spiked last year.



Deutsche Bank has hired Hassan Houari as global head of the equities structuring group in its equity derivatives team in London. He joins from Barclays, where he was a managing director and head of equity derivatives structuring, and most recently head of equity and funds-structured (EFS) markets.

Houari will report to Ian Holt, global head of equity structuring. His appointment follows the departure of Roger Naylor, who left the bank in June to take up the role of head of global equity derivatives at UBS. Naylor was most recently global head of both equity derivatives and equity risk at Deutsche.

Houari’s distribution responsibilities at Barclays have been taken on by Stewart Jones, who has been named head of EFS distribution in the UK. Jones joined Barclays recently from Bank of America Merrill Lynch and will work closely with the investor solutions and UK flow derivatives teams.

Houari joined Barclays in 2000 from BNP Paribas, where he was a member of the equity derivatives trading team. Barclays would not comment on the departure.

Deutsche Bank announced on July 31 that it will axe 1,500 positions in its corporate banking and securities business as part of an overall loss of 1,900 positions. In a statement, the bank said it will save €350 million as a result.

 

Georges Assi has left his position as deputy global head of fixed income at Nomura in London. Sources at the bank confirmed the departure, and indicated Assi was taking a break after 16 years in the industry. His replacement has yet to be announced.

Assi was appointed to his final position at the bank at the beginning of this year after an extensive reshuffle that saw Steve Ashley promoted to global head of fixed income. Prior to this, Assi was co-head of the firm’s European fixed-income division and head of its global credit products business – roles he retained after his promotion to deputy global head of fixed income.

Assi joined Nomura after the collapse of Lehman Brothers, where he had worked from January 2001 in a variety of senior roles, finishing up as co-head of fixed income for Europe, the Middle East and Africa. He also worked in JP Morgan’s asset swaps and credit derivatives trading business from April 1996 to December 2000.

 

Richard Martin has joined Longwood Credit Partners, a new hedge fund specialising in relative value corporate credit, as chief quantitative officer in London. Martin joins from Man Group, where he was head of quantitative credit strategies from October 2008. Prior to this, he was a managing director in the quantitative credit strategy team at Credit Suisse from June 2003 to July 2008 and a quantitative analyst at BNP Paribas from April 1998 to May 2003.

Martin won Risk’s Quant of the Year award in 2002, and has been a prolific contributor to the magazine’s technical section, with 17 papers published to date. These have covered a wide variety of topics, from credit trading to value-at-risk, expected shortfall and algorithmic trading.

 

Citi has bolstered its credit sales and trading operation in Europe, the Middle East and Africa (EMEA) with three new appointees. Pepijn Voorn joins the Dutch office to cover both flow and structured flow credit products from London. He previously worked at Bank of America Merrill Lynch as a vice-president of global markets, where he focused on flow credit, asset-backed securities and structured solutions.

Anju Kapur joins Citi’s Swiss sales coverage team in London, where she will focus on Geneva-based accounts. She arrives from Lloyds Banking Group, where she was associate director of Benelux and Swiss credit sales for the past five years. Kapur will now join the Swiss sales coverage team in London and focus on Geneva-based accounts. Prior to her time at Lloyds, she was an executive of prime services at Barclays.

A further credit sales appointment sees Christopher de Simencourt join Citi in Paris, where he will cover French, Belgian and Luxembourg credit sales. Prior to this appointment, he covered a similar area in the credit sales team at Natixis. All three new appointees will report to Conor Davis, head of EMEA credit sales in London.

Elsewhere, Citi’s credit trading team has hired Nicolas Dujols, who joins as a credit default swap indexes trader in London. Dujols joins from Capula, a fixed-income investment management firm, where he was a portfolio manager from April 2011. Prior to this, he spent two years as an exotic credit derivatives trader at Société Générale Corporate & Investment Banking, and four as head of credit trading at Polygon, another investment management firm. He will report to Gabriel Roberts, head of credit index trading.

 

Martin Ryan has been named LCH.Clearnet’s new group head of operations and client services. Ryan will report to Christophe Hémon, group chief operating officer, and will be based in London.

Ryan joins the firm from Royal Bank of Scotland, where he was managing director and head of markets operations from 2009. Prior to this, he worked at Morgan Stanley between 2000 and 2009, first running global equity derivatives and then fixed-income operations. He also worked at JP Morgan between 1994 and 2000, departing as vice-president in the fixed-income business line.

 

Royal Bank of Scotland’s (RBS) foreign exchange sales head Lisa Francis, who left in April, has joined Barclays as managing director and head of foreign exchange sales for the UK and northern Europe within the bank’s risk solutions group (RSG). Based in London, Francis will be responsible for developing and leading the RSG forex business in these regions. She has more than 20 years’ experience in the currency markets and was most recently head of European forex sales and global head of the event-driven forex business at RBS.

 

Credit Suisse has confirmed the appointment of Will Brett as managing director and head of Americas corporate equity derivatives in New York. Brett starts at the beginning of October and will report to Steve Winnert, head of Americas equity-linked origination.

Brett joins from Nomura, where he worked from May 2009, most recently as managing director and head of structured derivatives sales. Prior to this, he also worked at Bank of America from May 2000 as a managing director in US corporate equity derivatives.

 

From October 1, Robert Endersby will be Danske Bank’s new chief risk officer and head of group credit, pricing and risk, a function set up during a group reorganisation in June this year. He will also sit on the firm’s executive board.

Endersby joins from Royal Bank of Scotland (RBS), where he was chief operating officer of the bank’s credit risk unit from April 2011. Prior to this, he was chief credit officer at Barclays from February 2006 to December 2010, and head of credit information, policy and portfolio analytics at RBS from 2002. He has also worked at Ernst & Young and ING.

Endersby replaces Per Skovhus, who handed in his notice at Danske Bank last November and officially left the bank on July 1.

 

Kevin Blake has been named as the new chief risk officer for the Irish Bank Resolution Corporation (IBRC), formerly Anglo Irish Bank. Blake joins from the Co-operative Bank, where he worked for 13 years, most recently as director of banking risk and capital management. He succeeds Peter Rossiter, who in April became chief risk officer for the remaining portion of Anglo Irish Bank, which is now state controlled. In a statement, the IBRC said Roger McGreal would take up the role of interim risk manager until Blake joins the firm.

 

Shaun Barlow is set to join JP Morgan as a senior credit trader in London in late August. Barlow moves over from his position as managing director of European Union credit trading at Goldman Sachs in London, which he held for three years. Though JP Morgan declined to confirm the appointment, sources close to the situation indicated his position will be similar to the one he held at Goldman Sachs.

 

Shane Edwards is leaving his role as global head of structuring in investor products and equity derivatives (IPED) at Royal Bank of Scotland (RBS) in Hong Kong to join the UBS equity derivatives team in London.

Edwards, who reported to Beat von Gunten at RBS, joined the UK bank in September 2005 from Deutsche Bank. Prior to that, he spent three years in the systematic trading team at Macquarie Bank.

The RBS markets operation in Asia-Pacific will remain the responsibility of Pierre Ferland, while IPED will be led by Christian Erb, global head of IPED, and Beat von Gunten, global head of IPED sales. It is understood that RBS will not seek a direct replacement for Edwards; the three business heads that reported to him will now report directly to Von Gunten and Erb.

The three business heads are: Max Nelte, global head of custom index structuring, who will relocate to Hong Kong; Bernard Rogier, global head of structured equity pricing and payout development, who will move to London; and Olivier Destandau, Singapore-based head of investor product sales for Asia-Pacific, who will continue to lead the IPED sales team in Asia ex-Japan. Nelte and Rogier will run Asia-Pacific IPED structuring as part of their global responsibilities.

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