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July 2023 | Issue 256
Analysis
People
All change, please
Tom Davidson
Managing editor
It has been an extraordinary six months for CLO bankers, and we’re not just talking about the sorry state of the CLO market. It’s getting tough to keep track of who has gone where
This year has not only seen the fall of Credit Suisse, but also the arrival of two fresh faces — Scotiabank and CIBC — triggering a wave of hiring that has some way to run.
The fall of Credit Suisse has been a powerful factor in all markets, but in the CLO space the drama started early in the year. In February it was Natixis in the news, as the then dominant bank for middle market CLOs lost four senior executives in a day.
David Williams, Brad Roberts, Sheri Koval and Mark Dodson all left for Toronto-headquartered Scotiabank. Since then Scotia has continued to staff up, with hires including Prabu Soundararajan from Morgan Stanley and CLO trader Joe Guzzi from Jefferies. In another notable development, Jonathan McCormick joined from Deutsche Bank in Dublin, to become the first member of Scotia’s CLO team in Europe.
Scotia adds to strength in TRS
According to market sources, Scotia intends to be active in both the middle market and broadly syndicated spaces this year. Both sides of the business will be assisted by one of Scotia’s quiet strengths, loan TRS. The Canadian bank has been one of the most active players in the TRS market for decades, led by Ed Ra, head of FICC structured products in Toronto. It already has a team of loan traders supporting that business and they may be helpful for the CLO bankers.
Although Natixis retained some well-known figures, including head of US CLO banking Chris Gilbert, it clearly has a hole to fill. The first step in that process was announced late last month when Asif Khan moved over from MUFG as the new head of capital markets for credit products.
The most notable moves from Credit Suisse came a few weeks before the bank was acquired by UBS. Brad Larson and Gabrielle Garcia left for another Canadian Bank, CIBC. Larson was global head of the CLO new issue group at Credit Suisse, and will fulfil a similar role at CIBC, while Garcia heads up the CLO syndicate there.
CIBC seems a little behind Scotiabank in the rest of its build-up, but recently hired Genevieve Hagedorn, again from Natixis. According to market sources, the bank is also in discussions with a number of structurers to build out that side of the business.
CIBC is new to CLO arranging, but not to the market. For many years it has provided warehouse financing, and market participants assume it will be using that same balance sheet and address book to support the new CLO arranging business when it launches, probably later in the year.
Credit Suisse team moves on
The rest of the Credit Suisse CLO team appear to have scattered, including Arun Cronin, who was head of EMEA credit financing and CLOs, and is now at Morgan Stanley.
The other European bank in the spotlight is Deutsche Bank. As well as McCormick going to Scotia, this year has seen Matt Wiesner head to BMO (another Canadian bank moving in the CLO space) to head up US structured credit origination, including CLOs. Despite that, the core leadership team remains. In Europe, Colin Parkhill remains as head of European ABS & CLO syndicate and has been joined by another Credit Suisse veteran, Dimitris Papadopoulos, as head of European CLO new issue.
The bank has also been making junior hires, according to market sources, including Kailin Dougherty from Credit Suisse.
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Global credit funds & CLO's
July 2023 | Issue 256
Published in London & New York.
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