Crédit Agricole Indosuez is looking to rebuild its merchant banking and asset management division after the defection of Dan Smith, Ken Kencel and a handful of other key staff and administrative personnel to RBC Dominion Securities last month. Paul Travers, the newly appointed managing director and co-head of Indosuez Capital, said the firm is looking to reassure investors that it is committed to the loan market. Travers arrives from Bear Stearns, where he was a senior managing director of the leveraged loan group responsible for leveraged loan origination and structuring. Smith and Kencel, who established a strong reputation managing CDO funds combining loans and bonds, will oversee RBCs New York-based leveraged finance and asset management unit.
Indosuez is looking to recruit a portfolio manager and a structurer for the loan business and a number of analysts, Travers said. On the asset management side there may be more people than before the defections, he added. The timeframe for putting together a new squad is six to eight weeks, he noted, adding, there will be an emphasis on credit skills. "The business is about avoiding the downside. It's basic blocking and tackling." Travers is looking to develop new vehicles for the shop, but new structures are not imminent as the new personnel needs to get comfortable with the portfolio of 300 names, explained Travers.
On the merchant banking side, Thierry Vergnes, managing director and group co-head of Indosuez Capital, said Crédit Agricole, the parent company, has re-approved a risk strategy that will allocate capital to the middle-market lending world. "There is a huge demand for middle-market financing," he said.
Over at RBC, Smith, who is overseeing the asset management side, said the decision to leave was based on long-term opportunity, but declined further comment on Indosuez. "RBC is an entity looking to make significant progress in the U.S." On the leveraged finance side, RBC is looking to lead middle-market deals in the region of $50 million to $250 million. "Our focus will be on providing one-stop shop financings, including senior debt, private mezzanine debt and equity on a co-invest basis," said Smith.