Mizuho Securities USA is positioning itself to become a familiar name in U.S. CDO-ville, with former Calyon cash CDO head Alexander Rekeda leading the Japanese bank's foray into CDO issuance out of New York. Rekeda was a driving force behind Calyon's growth as a U.S. CDO underwriter, according to Mizuho. Now as Mizuho's head of U.S. structured credit, Americas, Rekeda said the company's sizable balance sheet, its flexibility and its presence as a global distributor position the bank for growth within the sector.
Mizuho is planning to enter the ABS CDO and CLO markets in the first half of 2007, followed by a shift toward commercial real estate and synthetic CDO transactions, Rekeda said. "We believe there will be some change in investor appetite from ABS CDOs to CLOs, Rekeda said, "That is where Mizuho can play the strong card," he said, referring to Mizuho's strong Japanese distribution network.
Rekeda specifically mentioned that the bank's size will allow it to finance super senior tranches, an advantage compared to the task of seeking a third-party investor. A growing trend in the market, he estimated that all of the ABS CDOs and CLOs it issues will have a synthetic bucket, although the size of the synthetic bucket will vary by manager in the case of CLOs.
Rekeda and several key members of Calyon's structured finance team recently joined Mizuho, where they are charged with building its U.S. cash and synthetic CDO business. The team is looking to add two traders, a structurer and a legal structurer in the near future. "We are very excited about joining Mizuho Securities. I think this is a great place to be," Rekeda said. Yuri Chumak, Xavier Capdepon, Gwen Snorteland and Rachel Yang left Calyon with Rekeda. Former Calyon senior ABS and CDO trader Paolo Torti joined Mizuho as head of structured credit trading.
Mizuho also hired Doug Munson and Jim Shepard as co-heads of U.S. debt capital markets, a new department for the company. Former Calyon staffers Bill Budd, Dan Will and Clifford Condon round out the team, which was set up to distribute new product lines for the bank, including project finance, corporate bonds, 144A and private placements.
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