Prudential M&G Plots Structured Credit Push

Prudential M&G is developing a structured credit investment offering for institutional investors and has hired William Nicoll, head of European credit at Henderson Global Investors, to run the business.

  • 10 Sep 2004
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Prudential M&G is developing a structured credit investment offering for institutional investors and has hired William Nicoll, head of European credit at Henderson Global Investors, to run the business. The new group is separate from the existing eight-strong collateralized debt obligation team run by Dagmar Kent Kershaw. Nicoll is due to start next month and could not be reached for comment.

The structured credit offering is being expanded in response to growing investor demand for products tailored to their risk and return requirements, said Pam Burgess, head of the institutional group. Pension funds, for example, need to respond to an increased emphasis on capital requirements and scrutiny of the risks that they are taking to get required returns, she said. Burgess added that demand for tailored structured investments has “snowballed” during the past few years.

A portfolio of leveraged loans with a duration overlay is one example of the kind of non-CDO structured product the new group will be developing, said Burgess. For example, an investor might wish to extend the duration of a leveraged loan portfolio with a five-year average maturity to 10 years. It could do this by selling two-year interest rate swaps and buying 10-year swaps, thereby artificially extending the duration. The structured product M&G would offer would include both the leveraged loans and derivatives.

Separately, Prudential M&G has hired Mike Nicholson, director in the CDO team at Standard & Poor’s in London, to structure and manage portfolios for the CDO team headed by Kent Kershaw.

Prudential M&G, which is unrelated to The Prudential Corporation in the U.S., runs £55.4 billion of fixed income assets in Europe and the U.K.
  • 10 Sep 2004

GlobalCapital European securitization league table

Rank Lead Manager/Arranger Total Volume $m No. of Deals Share % by Volume
1 Citi 3,237 10 19.12
2 Goldman Sachs 2,096 5 12.39
3 Morgan Stanley 1,965 5 11.61
4 BNP Paribas 1,686 6 9.96
5 Barclays 1,565 4 9.25

Bookrunners of Global Structured Finance

Rank Lead Manager Amount $m No of issues Share %
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1 Citi 32,618.79 103 11.88%
2 JPMorgan 25,662.81 73 9.35%
3 Wells Fargo Securities 24,627.51 67 8.97%
4 Bank of America Merrill Lynch 23,023.30 73 8.39%
5 Barclays 17,051.25 56 6.21%