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Derivatives

CIBC Plans To Reestablish Credit Coverage

CIBC World Markets is working to reestablish its credit derivatives structuring, marketing and trading presence. David Wagner, executive director of U.S. credit derivatives, said "this is a business that is simply crying out for further efforts from us. This will be a renewal of the credit derivatives business to complement CIBC's CDO and private placement work." CIBC plans to hire several professionals to staff the department, but Wagner declined to specify exact numbers.

CIBC first launched its credit derivatives group in 1995 and had a strong presence in the market until it began backing away from the business after the Asian market crisis of 1998, according to market officials. "After the fall of 1998, the bank put a squeeze on the credit derivatives group," said one market official. As part of the bank's new hiring initiative, CIBC hired Paul Morgan, who joined the firm about two weeks ago as an executive director of credit derivatives marketing for U.S.-based clients. He joined from BroadStreet, a structured products and securitization boutique founded by the former structured products team at Crédit Agricole Indosuez. While at BroadStreet Morgan focused on derivatives linked structured notes and structured products for oversees clients. Wagner added that the decision to reestablish the group was prompted by the firm's realization that credit derivatives are poised to experience major growth over the next year.

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