KeyBanc Capital Markets (KBCM) recently hired Christopher Moroz and Michael Giasi to its fixed-income team as part of its efforts to further expand the firm's MBS capabilities, as reported on Dec 19 by (see link).

Brian Brennan, managing director and head of the team, said that there is a "great opportunity more so now than before to hire mortgage talent as the larger bulge-bracket firms reduce their staff. This is an opportunity for firms like us with a regional presence to grow our distribution channels."

The recent hires, Brennan said, are in keeping with KBCM's future goals. For instance, bringing on Joseph McHale as managing director to its MBS sales and trading group in May and the hiring of Giasi are meant to broaden the firm's agency and non-agency mortgage product distribution.

Meanwhile, Moroz's new role will mean developing KBCM's mortgage and government agency desks to cater to the broader universe of domestic banks, thrifts and credit unions.

"Our mortgage and government agency desks have the appropriate product offerings to go out to banking institutions and develop better relationships with them. Chris Moroz, who was previously at PNC Bank, has a knowledge of how to cover banks," Brennan said

Furthermore, from an internal origination standpoint, Brennan has always had the goal of focusing on Fannie Mae DUS and Ginnie Mae Project loan securities. "We continue to better align KeyBank’s origination capabilities with KBCM's distribution network," he said.

The focus on agency MBS doesn't mean that KBCM will not have a presence in the subprime and non-agency secondary market sectors. Margarita Genis, who was hired in August 2011, currently covers the subprime space for KBCM on the trading side.

"We are going to continue to identify the right producers to interface with investors, where there's real opportunity," Brennan said, although he admits there are some limitations on the non-agency end. "There will continue to be secondary mortgage trades in non-agencies, and we will not abandon that area. But we do feel that the agency space will continue to be robust and a much larger part of the market."

Currently, KBCM has eight offices across the country including offices in Atlanta, Charlotte, Boston and Cleveland. It has 56 sales professionals across the trading and investment team that Brennan heads.

In an interview with May with, Brennan said that his team had been planning to add 20 professionals to the sales group across the various areas such as mortgages, municipals, high yield and investment grade credit.

Brennan said that he is still working on completing that number and in finding the right sales people for his part of KBCM's business.



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