Resource America, a Philadelphia asset management concern behind the Trapeza collateralized debt obligation shelf, has set up a start-up venture to buy asset-backed securities and repackage them into CDOs. The company has hired Dan Nigro, a former buy-sider, as a portfolio manager and head of credit and has set up an office in New York. Resource America's new platform, dubbed Ischus Capital, plans to retain part of the equity of the ABS CDOs it sells and aims to "build a larger, more diverse business managing a broader range of fixed-income securities," Nigro said in a letter to colleagues.
Publicly traded Resource America is involved in a joint venture with Financial Stocks of Cincinnati that makes up Trapeza. It has to date acted as manager on six CDOs backed by trust preferred shares, making it one of the most-prolific managers in the growing TruPs market. Trapeza has more than $2 billion of TruPs under management.
Ischus Capital and Trapeza will be run independently, according to Nigro's letter. Although Ischus is technically a start-up, because of Resource America's "experience as an equity investor, and its experience in underwriting the initial costs of creating a platform, I feel more comfortable about the start-up nature of the venture," Nigro said in his letter. A Greek word, Ischus roughly translates as ability or might.
Nigro and Pamela Schrieber, spokeswoman for Resource America, did not return calls by press time.
