Chase Securities last week nabbed Banc of America Securities' head of mortgage sales, Lawrence Doyle, in what some market sources described as a reunion of old mortgage kingpins.
Doyle, who is expected to undertake the same duties at Chase, was reportedly the one of the first hires current Chase MBS head Kevin Finnerty made at Bear Stearns & Co. in the early 1990s, as well as the first hire made when Finnerty built up the UBS Securities MBS shop in the mid-1990s. While Doyle's not the first hire this time around, a reunion between Doyle and Finnerty in Chase's Park Avenue headquarters was not a surprise to mortgage insiders.
"Larry Doyle was as important to mortgage-backed securities at Bear Stearns as Howard Rubin was to collateralized mortgage obligations," said Chuck Ramsey, CEO of Mortgage Risk Assessment Corp. and former general partner of Bear Stearns. "And now you have a sales manager (at Chase) that has trading experience. How rare is that?"
As of press time, B of A had not named a replacement for Doyle, inside sources said. The shop is reportedly determining whether to promote an official from within, likely relocating a pro from B of A's Charlotte, N.C. headquarters to New York, or whether it would recruit someone from another firm. The shop did not return calls for comment.
Finnerty has been busy since being appointed head of Chase's MBS trading operations last November, where he landed after a brief period spent with Freddie Mac. In the last month he has raided Donaldson, Lufkin & Jenrette for Bob King, who now heads Chase's passthrough MBS desk and Alan Galishoff, who heads Chase's collateralized mortgage obligation and derivatives desks. Finnerty's MBS operation is reportedly looking to nab up to 20 more traders and sales professionals in the next few months.
It appears Chase is hoping Finnerty can be as good a pied piper as he was in the last decade, when he helped build a legendary MBS team at Bear Stearns and lured about three dozen mortgage pros to UBS. Much of Finnerty's connections are owed to his long-term expertise, as he held positions at Morgan Stanley and Salomon Brothers before establishing himself with a 10-year tenure at Bear, where he ultimately served as a managing director and head of trading.
Sources wondered whether other former UBS/Bear veterans would be joining Finnerty at Chase, given that has been the formula in the past. When he went to UBS in 1996, Finnerty quickly hired Bear colleagues Doyle, Matthew Callahan and Andy Kowalczyk as his first group of traders.
Finnerty's hire and subsequent hirings have served to put the market on notice that Chase hopes to achieve a greater MBS presence in 2000. In 1999, the shop ranked 14th according to Thomson Financial Securities Data, with $3.6 billion in proceeds underwritten. By contrast, B of A ranked 10th, with $12.5 billion, and DLJ ranked eighth, with $19.9 billion.
But critics said that Chase's moves remind them of similar noises made by Finnerty's old shop, UBS, in the mid 1990s. UBS was stuck in a similar league table rut, and despite Finnerty's group's efforts, disbanded its MBS operation in early 1998 when it merged with SBC Warburg Dillon Read.