Raphael Geys, European head of fixed income sales in London, has left UBS. Geys found fame in the derivatives markets when he was at Merrill Lynch by generating huge profits during the 1990s through interest rate derivatives transactions with the Kingdom of Belgium, one of the first sovereigns to enter the over-the-counter derivatives markets. Sarah Small, spokeswoman at UBS in London, confirmed Geys had left the bank, but declined further comment. Geys' plans could not be determined.
UBS watchers said Geys' departure stems from a reshuffle over a year ago which saw Tim Fredrickson, head of interest rates, move aside and Robert Wolf and Michael Hutchins become global heads of fixed income. Before the reorg Geys was global head of fixed income derivatives marketing and structuring. He reported to David Shulman, head of fixed income sales.
Geys left Merrill in 1998 after a 10-year stint when a bank wide reorganization--promoted in part by the Russian financial crisis--led to several senior derivatives staffers quitting. His huge P&L and strong management skills had seen him rise to head of liability management, a department set up principally to market derivatives to corporates. After leaving Merrill, Geys spent a year out of the industry before joining UBS.
The Kingdom of Belgium trades turned sour in 1996 and the sovereign announced it had BEF32 billion (USD1.22 billion) of unrealized losses on positions that were designed to hedge the currency component of foreign currency-denominated debt. In the trade, Belgium received a premium in return for a payout at maturity of the difference between the strike and the dollar/mark spot rate, squared (DW, 12/2/96).
