Securitization People and Markets

Based jointly in Charlotte and New York, Lancaster heads up the CMBS and fixed-income real estate research effort as well as assisting Wachovia's underwriting efforts in the corporate finance area. He joined the firm from Bear Stearns in July 2001. He was assisted in this article by his research colleagues Davis Cable and Kathy Mixon.

Joseph Philips, an asset-backed securities analyst who specialized in aircraft securitization, has resigned from Morgan Stanley where he worked for the past five years. "We are sorry to see him go, but Joe has decided to leave the business and pursue personal plans," says Chip Schorin, managing director and head of global ABS research. Prior to joining Morgan Stanley, Philips worked in the securitization field for eight years at Salomon Smith Barney.

Three members of an eight-person team overseeing the $1.8 billion high-yield portfolio of Seneca Capital Management, a San Francisco-based money manager with $14.9 billion in total assets, have resigned. High-yield officials close to the three say they were upset because they felt Gail Seneca, the firm's ceo and cio, was meddling in their investment decisions, causing their performance numbers to slide. Seneca's high-yield team has beaten its benchmark, the Lehman Brothers high-yield index, in every year since 1997, according to gross performance figures posted on the firm's Web site. However, the team underperformed its benchmark in the fourth quarter of last year. First quarter performance figures were not available, and Gail Seneca declined to provide them. Seneca would not comment on why the trio chose to leave, and says she has "no way of calibrating" how much she is involved with the high-yield group.

Three members of an eight-person team overseeing the $1.8 billion high-yield portfolio of Seneca Capital Management, a San Francisco-based money manager with $14.9 billion in total assets, have resigned. High-yield officials close to the three say they were upset because they felt Gail Seneca, the firm's ceo and cio, was meddling in their investment decisions, causing their performance numbers to slide. Seneca's high-yield team has beaten its benchmark, the Lehman Brothers high-yield index, in every year since 1997, according to gross performance figures posted on the firm's Web site. However, the team underperformed its benchmark in the fourth quarter of last year. First quarter performance figures were not available, and Gail Seneca declined to provide them. Seneca would not comment on why the trio chose to leave, and says she has "no way of calibrating" how much she is involved with the high-yield group.

Trading was light in the high-yield market during the holiday-shortened week. Traders expect up to $2 billion in new supply next week, which may have softened bidding in certain sectors, such as chemicals. Here was some notable action:

High-yield portfolio managers and a sell-side investment-grade analyst are divided in their views regarding the bonds of telecommunications equipment maker Solectron Corporation, and one of its chief customers, Nortel Networks.

Credit Suisse First Boston is looking to beef up its presence as a structurer of high-yield credit derivatives. Joe Russell, global head of leveraged finance trading, says the firm will look to add two senior traders and possibly a structurer, though it has yet to be determined whether CSFB will move people internally or hire from outside. Russell says credit derivatives, traditionally associated with investment-grade credits, have increasingly begun to trade on high-yield and bank loan desks. Russell attributes the increased popularity to the increasingly volatile credit environment of the last 12-18 months. He would not disclose specific clients who have demanded credit derivatives, though he says the product is particularly popular with hedge funds.

Fidelity Investments has created a new position by adding a European fixed-income business development slot and has hired Martin Hall, formerly head of fixed-income at Norwich Union Investment Management to fill it. Martin, who will report to David Stewart, president of European institutional business, will be responsible for business development in the U.K. and Europe, says a firm spokeswoman. Fidelity manages roughly £8 billion in fixed-income assets in the U.K. and Hall was brought on board to help meet the new business opportunities created by European pension funds' increased interest in fixed-income investing.

Putnam Investments has begun a search for a credit analyst to support its high-yield collateralized debt obligation research effort, says Steve Peacher, cio with the Boston-based asset management firm. Peacher says the new hire would work on a day-to-day basis with Neil Reiner, high-yield portfolio manager, although he would report directly to Paul Quitsberg, senior v.p. and head of research.