Bank of New York is setting up a dedicated par trading desk with a plan to provide liquidity in areas that traditionally have not been well served by the loan market. BNY recently hired veteran bank debt trader Neil Brisson to spearhead this effort. He previously was the head par trader at Merrill Lynch and was one of the first bank loan traders when he worked at Manufacturers Hanover. He is said to be doing proprietary trading as well as brokering.
Brisson will provide liquidity for BNY names or where the bank is an important lender on both investment and non-investment-grade loans, according to a market source. He will also be active in sectors that traditionally have not traded, such as middle-market names, real estate loans and utility names, which are strong areas for the bank, he added. Brisson will report to Glenn Autorino, co-head of syndicated finance. Autorino declined comment on the effort, while Brisson could not be reached. There are no plans to add other staff at this time, said sources.
An investor said Brisson will make a significant contribution to BNY's loan platform. A trading capability will expand the base of investors BNY can go to for syndication of deals in these areas, explained sources. There are a lot of middle-market deals being brought to market, but what is holding some accounts back is a perceived lack of liquidity, said one banker. Knowing a desk is making a market in these names will encourage more institutional investors into these deals, he added.
Sources said the bank had been considering the move for some time, but was waiting for the right person. "He is a well-known brand name," the banker stated. BNY has always traded loans, but this will enable the bank to broaden the effort and cover more names investors are interested in. BNY will not be trying to make markets in loans that are already actively covered.