Gruntal & Company closed its proprietary high-grade corporate bond trading desk in New York last Thursday and dismissed 30 corporate bond salesmen, traders and support personnel, according to BW sister publication Wall Street Letter. Consequently, the firm will cease making markets in fixed-income products. The move was first announced Wednesday night in an internal e-mail, and Henry "Hank" Gottmann, the president of the firm's private client group, elaborated on the plan in a conference call last Thursday morning to branch managers. Gottman could not be reached by press time.
The desk was closed because the firm wants to shift resources to its institutional and retail divisions, firm insiders say. It was a "capital intensive, risk taking activity that we decided that we no longer want to be in," said Randy Bradley, executive v.p. and chief information and planning officer, adding that the move "allows us to focus our resources on core businesses--retail and institutional distribution businesses." The firm sold the division's bond portfolio to a handful of financial institutions, Bradley said, but declined to name them.