John Wotowicz, managing director and head of European leveraged finance at Morgan Stanley, will move back to New York to assume "a very senior role in covering some of the firm's most important leveraged finance clients," according to a senior firm official, who would not be more specific. The reassignment of Wotowicz is the latest move in an effort by the company to rebuild its leveraged finance business. Morgan Stanley fell from fourth place in the U.S. high-yield underwriting league tables in 2000 to sixth place in 2001. So far this year, the firm is in eighth place, according to Bloomberg. Competitors say it became very cautious after it suffered some high profile losses in its trading group. The official says additional changes in the leveraged finance group will be announced in the next few weeks, but he would not give further details. "It's more of an incremental repositioning than a wholesale restructuring," he says.
Morgan Stanley has already taken several steps to address perceived weaknesses in the group. It recently returned William Kourakous to his position of global head of leveraged finance, moving Alan Jones, the former head, to the new position of co-head of the group catering to private equity firms. The firm also recently lured three loan executives away from Goldman Sachs to join its leveraged loan sales and trading effort. The official claims it has improved since Kourakous was brought in, and it has climbed in the U.S. high-yield bond underwriting league tables in recent weeks. (The firm was in fourteenth place at the end of January.)
Wotowicz's European role will be filled by May Busch, who had been in charge of debt coverage for investment-grade clients. She will retain those responsibilities, aided by Jeff Bennett, a managing director who had worked under Wotowicz.