Greenwich Capital Markets, which has substantially increased its presence in the asset-backed securities market this year, sees the recent shake-up in the investment banking community as an opportunity to gain market share, and possibly snag some senior talent.
"There's a lot of consolidation out there... and we're looking at all the resulting dislocation with an eye toward opportunity," said Gregory B. Jacobs, a managing director in the asset-backed securities trading group at GCM.
Jacobs named the exodus of Prudential Securities, and the several bank consolidations (i.e. J.P. Morgan/Chase Securities, Donaldson, Lufkin, & Jenrette/Credit Suisse First Boston, and UBS Warburg/PaineWebber).
"We expect to see some good people become available over the next few months," Jacobs added. "And there's an opportunity for us to potentially get some of those people working for Greenwich."
Jacobs said that GCM would add one or two senior salesmen, and possibly an experienced asset-backed/mortgage-backed trader.
"Also, we're looking for some new hires on the banking side in our [commercial mortgage-backed securities] and asset-backed groups," Jacobs said. "We generally would like to see people with anywhere from two to four years of experience, and there's a lot of them that are going to be out there."
NIMs Is Good
Early in the year, GCM was acquired by Royal Bank of Scotland, which has proven to be positive for the bank, adding stability to the business, Jacobs said.
"We've got a nice parent and we're moving forward," he said.
Throughout the year, GCM has been among the top five managers in the home-equity sector, with year-to-date underwriting proceeds nearing $6.5 billion in home-equity, and $8 billion in total for the public and Rule 144A markets.
GCM was lead manager a number Option One Mortgage Corp.'s home-equity transactions. Similarly, along with Salomon Smith Barney, GCM was co-lead on Royal Bank of Scotland's Arran One and Arran Two deals.
Other issuers GCM won business from this year include Saxon Mortgage Corp., First Franklin Financial Corp., Countrywide Credit Industries and, most recently, Greenpoint Mortgage Corp.
GCM has also been active in the development of net interest margin securities (NIMs), which is the monetization of the interest-only strip, or the residual piece. GCM has placed six or so NIMs for its issuers.
"I think we've developed a very strong marketing presence in NIMs," Jacobs said. "That helps drive the new issue process. Our marketing prowess for placing those NIMs certainly helps us."
GCM recently promoted George Davala to head of asset-backed sales, reporting to Jay Lavine, co-chief executive officer of GCM. Davala has been a sales executive with GCM for the past decade. Also, Ryan Mullaney, who has been head of ABS sales for GCM's Chicago office, will take on new responsibilities including GCM's sales effort in San Francisco.
Separately, GCM is in the market with two CMBS deals, although details were not available.