Rich Lightburn, managing director and co-head of pass-through trading at Goldman Sachs in New York, resigned last week and plans to join HSBC. Lightburn, who spent 15 years at Goldman, said he will run trading for all liquid mortgage products, including pass-throughs, adjustable-rate mortgages and mortgage options in his role at HSBC. The post is a new one he will take up at year-end.
The hire is the latest in a slew by HSBC in recent months as part of its long-range plan to create a mortgage-backed securities business. The London-headquartered giant hired Neil Leonard and Todd White, co-heads of the MBS business at Lehman Brothers in New York, earlier this year for similar roles at HSBC (BW, 5/31). Lightburn will report to them and will manage the desk as well as trade securities. He starts in his new role Dec. 20. "It's an opportunity to build a business from scratch," he said, explaining his move. White did not return a call.
Despite all the talent HSBC has brought in, outsiders said the jury is still out on whether the firm will be able to develop a top-tier MBS franchise. They point to HSBC's history of moving in and out of markets opportunistically and a pay structure for salesmen at the leaner end of the scale as two potential roadblocks to the bank's ambitions.
Jon Sobel, managing director and head of MBS trading at Goldman, said Lightburn will not be replaced. He had been co-head of the pass-through business with Justin Gemelich, also a managing director, who will now be the sole head.
Other banks are also moving into the MBS business en masse. Barclays Capital, Merrill Lynch and Washington Mutual have all hired well-known veterans of the Wall Street dealer community in recent months as part of efforts to expand or start from scratch MBS operations.