Securitization People and Markets

J.P. Morgan Securities has hired Greg Boester as an adjustable rate mortgage securities (ARMS) trader. He fills a newly created slot in the firm's residential mortgage-backed securities trading operation. He will trade the non-agency, or whole loan, ARMS sector, says division chief Kevin Finnerty. Boester joins from Lehman Brothers. He is the second ARMS trader hired away from Lehman by JPM in the last several weeks, joining former colleague John Horner (BW, 3/3), who trades the 15-year and agency ARMS sectors. Boester is a v.p. and will jointly report to pass-through trading chief Bill King and ARMS trading boss Tom Wiles.

The low price of an outstanding issue by Panavision explains the unusual structure of a proposed new $250 million bond deal by the company, according to an official familiar with the deal. The proposed issue would give bondholders a second lien on collateral that is part of the deal--a higher degree of security than is typical in media sector issues, one media analyst says. However, higher security was needed because a deal comparable in structure to the outstanding issue would require a coupon of well over 20%, since that is where the outstanding issue was trading last week. Several high-yield desks did not have trading levels for the camera maker's single outstanding high-yield issue, its 9.625% senior discount notes of '06 (Caa1/B-), but one sell-side desk quoted the bonds at 40 last Tuesday. High-yield officials offer several explanations for the low price, including the company's high leverage (5.5-6 times debt-to-cash flow), the bonds' poor position in the capital structure given the amount of bank debt outstanding, and concerns that competition from digital technology will reduce cash flow.

Marconi is poised to proceed with a debt-for-equity swap in a move to restructure its balance sheet, London-based telecom analysts say. The move would involve bondholders eventually swapping their debt for shares. The increased likelihood of the swap comes after Moody's Investors Service downgraded Marconi's debt from B2 to Ca last week. "We've been very negative on this situation since last year and it is clear some sort of restructuring will take place, most likely a debt-for-equity swap," says Aizaz Shaikh, a telecom analyst at BNP Paribas.

Nomura Securities International in London has hired Christian Marx, formerly head of collateralized debt obligation structuring for Europe at Morgan Stanley in London, to head its CDO group, a newly created position. Tariq Rafique, managing director and head of the securitization and asset finance group and to whom Marx will report, says Marx's hire adds some "additional horse power" to Nomura's CDO capability. "Our goal is to be a significant player," he says. Currently, Nomura has five people dedicated to its CDO business, and that number will increase as the business grows, adds Rafique.

Harry Resis, head of high-yield at Zurich Scudder Investments in Chicago and a longtime and high-profile portfolio manager, is giving serious consideration to leaving the firm, according to three senior sell-side officials who say they have spoken to him directly about the matter. They say he is unhappy over the planned reorganization of the high-yield business following Deutsche Asset Management's acquisition of Scudder, which is expected to be finalized within the next few months. While details are still being worked out, the plan would be to move the bulk of Scudder's roughly $5 billion in high-yield assets to Philadelphia, where it would be managed by Andrew Cestone, who currently manages some $650 million for Deutsche Asset Management. Resis, reached at Scudder's offices in Chicago, declined comment.

Robert Drutman has resigned from the European Bank for Reconstruction and Development where he was asset-backed securities portfolio manager. Drutman, who managed $2.5 billion in ABS for the EBRD in London, told BondWeek he decided to pursue a new challenge.

Last week saw a mostly flat secondary market through Thursday, with most new issues performing well, as had been the case the previous week. Better-performing sectors such as gaming and homebuilding were weaker, as cyclical names were better bid. Here was other action.

J.P. Morgan Securities has hired Joe Acurso and Mark Hansen, both of whom are v.p.s, from Merrill Lynch to head up a new project loan trading effort. Both Hansen and Acurso will ultimately report to mortgage department chief Kevin Finnerty. On a daily basis, they will report to Tom Wiles, managing director. Specializing in Ginnie Mae-backed loans, the pair helped originate and trade three transactions for approximately $1 billion while at Merrill. Finnerty was traveling and unavailable for comment.

J.P. Morgan Securities has hired David Montano to become chief of all mortgage research--a new slot--at the firm. He joins fromCredit Suisse First Boston, where he ran the firm's MBS research effort. He will report jointly to residential MBS chief Kevin Finnerty and Nanette Abuhoff, head of interest-rate research. Montano, who made his first appearance last year on the Institutional Investor All American Fixed-Income Research Team, will take over for Joan Rogers, who has moved to the bank's MBS investment portfolio side. Montano, who had left CSFB as of last Thursday, did not take any colleagues with him, nor was it certain when he would begin at J.P. Morgan, or what his title would be. Montano could not be reached and Finnerty did not return a phone call seeking comment.