Securitization People and Markets

The two major ratings agencies have seen a sharp spike in employment inquiries in recent weeks, with many coming from the biggest users of their information: The New York dealer community. Brian Clarkson, asset finance group chief at Moody's Investors Service, says he is getting more resumes and calls than ever before from Street bankers seeking ratings analyst positions. Clarkson received 500 resumes recently from an ad Moody's placed in the Wall Street Journal, 50 of which came from people at different levels of investment banking. "We used to get only a few inquiries from bankers, but with the recent downsizing seen on the Street, we get more and more of these calls everyday," notes Clarkson. "This is a higher than usual ratio," he notes.

Vertical Crossings, the New York-based structured-product electronic trading network, has added John "Chip" Montgomery, the former director and national sales manager of high-grade products at SG Cowen. Montgomery left Cowen in 2000 and joined wireless trading application provider SmartServ Online, where he was in charge of global sales and business development. He was unavailable for comment, and a spokesman for SmartServ did not return a call seeking comment. His position is newly created, and he will be responsible for expanding VCross' institutional customer base, either via facilitating telephone-assisted trading, or selling the electronic trading platform itself, according to Steve Beck, executive v.p. Montgomery, who will be a v.p., will be based in New York and report to Pat Downes, president, and Beck.

Lehman Brothers has recruited Drew Nugent from Fitch as an associate banker in its asset-backed securities financial group, according to Nelson Suarez, managing director, who heads Lehman's ABS banking division. Nugent, who will directly report to Suarez, was unavailable for comment.

Noting the stellar stock performance of a number of gaming companies, fixed-income analysts say new equity offerings could be forthcoming, which may well increase investor sponsorship in an already hot sector. Andrew Zarnett, gaming analyst at Deutsche Banc Alex. Brown, says that funds raised via equity sales would probably be used to pay down bank debt and deleverage, making their bonds tighten further as cash flow and financial flexibility ratios increase. Though the sector has performed extraordinarily well, Jacques Cornet, gaming analyst at CIBC World Markets, believes new equity deals could cause another 25-50 basis points of tightening in what has already been a tight sector. Gaming yields were 504 basis points over Treasuries last week, in from 588 at the end of March, though slightly wider than the 483 over on June 30, according to Merrill Lynch indices.

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.

Swiss Re, the bond reinsurance giant, has hired Frank Ronan, the former global head of structured credit products at Chase Securities, for its Swiss Re Financial Products unit in New York. Additionally, it has also addedDavid Hough, who was a senior structured finance executive at ABN Amro, to its Swiss Re New Markets unit. Both positions are newly created, according to a spokeswoman at Swiss Re in New York.

Bob Barmore has been promoted to managing director and head of loan sales for Société Générale replacing Kevin Meenan, who left July 13 to become head of distribution at ABN Amro. Meenan and an official from ABN AMRO did not return calls. Barmore, who's been with the firm for three years, was a director of loan sales. There are no hires planned in conjunction with the promotion. Barmore did not return calls for comment.

BNP Paribas in New York has hired Brian Leach as an associate. He will work in the firm's asset-backed commercial paper conduit program. Leach, who is scheduled to start in August, will report to Sean Reddington, director and group head asset securitization. He moves over from State Street Capital in Boston where he was a senior associate in the conduit department. Leach was not available for comment. Reddington says he may hire more ABS experts in the coming months. A banker at BNP says David Brunner, ceo of the fixed-income department, is looking at hiring CDO experts for the firm's U.S. based CDO operations. Brunner was travelling and unavailable for comment.

The St. Paul Companies may seek to term out its commercial paper program via a senior public debt offering, according to BW sister publication Insurance Investment & Finance. Tom Bergmann, v.p., treasurer, said the trigger for a potential deal would be if the company's outstanding commercial paper, currently $300 million, were increased to $600 million. Given the staggered nature of commercial paper issuance and maturity, Bergmann was unable to estimate when the company may rack up the $600 million balance. The potential senior offering would draw off a previously filed $1 billion shelf registration, but the company has not yet determined the structure or considered any underwriters for the potential financing, saidThomas Bradley, cfo. "Right now we're modestly leveraged with a 19% debt-to-total capital ratio and have the ability to lever that up a little bit," Bradley said, adding the company would be comfortable taking its debt level into the mid-20s.