Securitization People and Markets

Daniel Scotto, former head of investment-grade research at BNP Paribas, is seeking "at least" $100 million in damages from his former firm in an NASD Dispute Resolution panel. Scotto claimed in a Wall Street Journal article that after recommending clients sell Enron bonds he was forced to leave BNP Paribas because the firm feared that such a recommendation would damage its investment banking relationship with Enron. BNP co-managed an Enron debt offering in Europe in the spring of last year, according to a claim filed by Scotto's lawyers Liddle & Robinson, a copy of which was obtained by BondWeek.

Last week was flat overall in high-yield, and traders said 90% of the trading was in bonds of Adelphia Communication. In the primary market, PacifiCare announced it would try to issue again after a planned offering was called off last summer. A deal by Trump Hotel & Casinos was still waiting to price at Thursday's close as traders remained skeptical that it would get done at all. Here was other selected action.

Deutsche Bank has lost another member of its corporate bond research group with the resignation of Peter Mullen, who was a v.p. covering the retail and consumer products sectors. A former colleague says he has joined Westmoreland Capital, a New York-based hedge fund, and has not yet been replaced at Deutsche Bank. Mullen could not be reached, and David Folkerts-Landau, the firm's head of markets research based in London, did not return calls.

Bill Demchak, who resigned last month from his position of global head of structured finance and credit portfolio, says he has not burned his bridges with J.P. Morgan Securities and associates say he could, if he decided to, come back to the firm after the summer. Reached at his home in Manhattan, the high-profile banker says he is on a sabbatical for an undetermined length of time. Chris Lemko, a spokeswoman with the firm, says management at the bank is encouraging Demchak to come back. Demchak says he wanted to take the summer off as he approached his 40th birthday with the intent of spending more time with his family. Someone at the bank, familiar with his move, says that Demchak, who has two kids, a boat and a house in the Hamptons, was offered a sabbatical as a way to accommodate his request to take the summer off. "He could be back four or five months from now," says this source. Demchak declined to indicate if he had such plans when the summer is over.

Citigroup Investments officials will most likely search for analytical expertise as they look to replace a senior portfolio manager and a trader who recently left the firm, according to a senior fixed-income official familiar with the firm's plans. Kathy Karlic, a senior portfolio manager who recently left the firm after 17 years to join GE Asset Management, had previously been Citigroup's research head. More recently, Citigroup lost Joe Mullally, a senior emerging markets trader who joined UBS Principal Finance (BW, 5/13).

Credit Suisse First Boston has hired David Jansky as a v.p. in its structured finance collateralized debt obligation group. He reports to Chris Ricciardi, managing director and head of U.S. structured credit products. Jansky, who started two weeks ago, will work on structuring asset-backed securities CDOs as well as investment-grade CDOs. Ricciardi says the position is a newly created one as his group has been expanding.

Tony Smith has resigned from Credit Suisse First Boston where he was a managing director and co-head of U.S. investment-grade research. Smith is widely expected to join J.P. Morgan Securities, but a person at that firm says he is unaware whether Smith's expected hire has yet become official. Smith would pick up commercial bank coverage from Katy Rossow, a v.p., who has resigned and will leave shortly to join GE Asset Management in Stamford, Conn, according to an internal announcement sent out by Margaret Cannella, head of high-grade research at J.P. Morgan. Cannella declined comment, and Smith, Rossow and Robert MacDougall, head of fixed-income at GE Asset Management, did not return calls.

Deutsche Asset Management has hired Greg Croll as head high-yield trader for its Philadelphia office. He joined last week, reporting to Andrew Cestone, portfolio manager and head of high-yield. Croll's most recent position was as New York-based managing director and head of fixed-income trading at ING Barings Securities, which shuttered its operation about a year ago. He declined comment, and Cestone did not return calls. A fixed-income official close to Croll says he wanted to return to the buy-side, where he spent five years, also at ING.

The Bond Market Association, the New York-based-bond dealer trade group, is studying the feasibility of opening a Tokyo office to help facilitate interaction between its members and regulators in the Japanese market. Micah Green, president, says he hopes to have the study done by the July board meeting when he says the matter can be put to a vote. Green says that over the past several months he has had conversations with board members who have said that the growth and importance of the Japanese repurchase agreement markets, as well as the securitization and e-commerce markets, warrants the BMA's presence in Tokyo.