Securitization People and Markets

BNP Paribas has altered the reporting line for its London-based European securitization research group so that it now reports to a banker--Ra Sharma, global head of structured credit syndicate, instead of to the head of credit strategy. Two people at Paribas and securitization analysts at competing firms confirmed the change in reporting lines.

US Bancorp Piper Jaffray Asset Management has hired Tony Rodriguez to oversee its $30 billion fixed-income portfolio. Rodriguez left the New York offices of Credit Suisse Asset Management (CSAM) last Friday, where he oversaw the firm's $5-6 billion in corporate bond assets. He will take charge of US Bancorp's 40-50 person Minneapolis-based team later this month. Rodriguez's former boss,Gregg Diliberto also resigned last week from his position as managing director and head of CSAM's core fixed-income assets. He is taking a senior fixed-income position within a $160 billion largely proprietary portfolio at Citigroup Global Investments. His hiring is not related to the departure of a team of portfolio managers from Citigroup Asset Management (see story, page 2.)

The market for cash flow collateralized debt obligations will be hit hard by the WorldCom accounting debacle, market players say. One CDO collateral manager notes that cash flow CDOs have much more exposure to WorldCom than they do to Enron, the previous corporate fiasco, which had a minimal effect on the cash flow CDO market. The manager predicts that investment-grade CDOs with exposure to WorldCom will be severely downgraded, making the CDO corporate market more volatile as a whole. He reasons that with so many corporate CDOs backed by WorldCom debt, downgrades in the collateral will put added pressure on the CDO notes, contributing to a worsening in investor confidence in the CDO market.

High-yield hung in relatively well through Thursday of last week considering the carnage on the equity side.New issuance included a $305 million Goldman Sachs-led deal for Oregon Steel Mills. Though Qwest Communications' bonds took a beating, traders and salespeople believe at least 30% remains in high-grade accounts.

Mizuho Corporate Bank has lost its second-in-command on its securitization desk. Ian Gray, director of structured debt and structured finance, has left the firm to travel, according to a firm insider. Gray reported to Tim Saunders, head of securitization, who was on holiday at press time and could not be reached for comment. In May, Thierry Sebton, Tarek Safi and Enrique Marin all left Mizuho to join Royal Bank of Scotland's securitization team (BW, 5/5).

Alex Braun, director of funding and asset management on the fixed-income side, and Paul Caldwell, a senior asset-backed and high-yield bond portfolio manager, have left Abbey National's wholesale bank. The departures are the result of a restructuring in the wholesale bank, a spokeswoman says. Braun's responsibilities have been divided, with funding now being part of the Treasury division and asset management coming under a newly established division--asset management and risk transfer. It could not be determined whether Caldwell will be replaced. Braun and Caldwell could not be reached for comment.

A buy-side and sell-side analyst say Elan's bonds are drastically undervalued, despite a Securities and Exchange Commission query into the Irish drug company's investment banking relationships, and the resignation of two top executives last week. The sell-sider argues that the company's products generate sufficient cash flow to pay off its debt, and that the $4 billion in cash on its balance sheet gives it flexibility for its near-term needs.

Credit Suisse First Boston last week snared Robert Franz, v.p. and par trader at Morgan Stanley, adding a seasoned trader to a stocked bench in an effort to beef up its market coverage. The firm, one of the powerhouses in the loan trading market, is expanding its group because of an increase in the volume of trading among banks and institutions. Franz will be a director and senior trader working with par and stressed loans. A rival dealer noted CSFB is bucking the trend in the loan trading market. "They seem to be moving in the opposite direction of other banks, which are holding tight or scaling down," he said.

Robert Lefkowitz has left Delaware Investment Advisers in Philadelphia, where he was a high-grade trader, to join Deutsche Asset Management in New York as a high-grade industrials trader and v.p. sector manager. Lefkowitz says he made the move because he wanted to return to New York where he grew up and started his career. He will report to John Ryan, managing director. Ryan did not return calls. Ryan Brist, who manages Delaware Investment Advisers' core and core plus institutional assets, declined comment about his plans regarding a possible replacement for Lefkowitz.