Deutsche Bank is consolidating elements of its global cash and derivatives credit business in a move designed to take advantage of increasing overlap between the various elements of the credit business, according to Rajeev Misra, global head of credit trading in London. However, one official familiar with the firm said the moves are motivated by a need to cut costs, which Misra denied.
The reshuffle was launched in Tokyo, where the firm is combining integrated-credit trading and asset-backed securities on a local basis under new head David Shrenzel, managing director on the ABS side in New York. However, the businesses will retain separate global reporting lines to Misra and Phil Weingord, global head of the asset securitization group in New York.
The firm also has plans for a reshuffle of its global CDO business, said Misra. The collateralized debt obligation duties from three departments will be put into a single entity, run by Brian Zeitlin, the previous head of high-yield CDOs in New York. Paul Czekalowski and Alex Graham, co-heads of European credit structuring, will continue with the bulk of their business, which includes synthetic asset-backed securities and CDOs referenced to exotic underlyings. Graham and Czekalowski declined comment. Shrenzel, Zeitlin and Weingord did not return calls.
The move makes sense because of growing overlap between traditional cash asset-backed securities and synthetic credit products, according to a senior rival credit derivatives banker in Tokyo.
The plans come from the top, according to one official. When Josef Ackermann became spokesman for the board of managing directors earlier this year he said he wanted to reduce headcount costs at the European firm. Combining departments is the most obvious way. Ackermann's office refereed calls to the press office, who declined comment.
