Marathon Asset Management snagged Rick Smith and Steve Paton from bankrupt Mortgage Lenders Network USA to head up a new specialty loans servicing and loss mitigation business to be called Marix, the company announced. Smith was a senior vice president of loan administration, while Paton served as head of the Arizona operations. Marathon said it expects Marix to begin operating "in the near future." Market participants are expecting a handful of specialty loan servicing shops to crop up, as the subprime market continues to face downward pressure. MLN filed for Chapter 11 bankruptcy earlier this month.
ACA Capital Holdings is preparing to market its first European loan-backed CLO. The company is also ramping up five transactions, two of which it is currently marketing, along with a managed tranche program, said Alan Roseman, president and chief executive of ACA, speaking during the company's fourth-quarter earnings call. Roseman also said the company has equity exposure to CDOs backed by 2006 vintage subprime mortgages in four deals - primarily from two 2006 mezzanine deals where only $4.9 million in total were invested. ACA bought triple-B minus credit protection from the ABX.HE 06-2 and 06-1 series to hedge its exposure. Interestingly, the firm seems to be progressively limiting its equity exposure to mezzanine ABS CDOs, as it had $50.8 million in equity invested between two mezzanine ABS CDO deals issued in 2003. Those deals carry a 20% exposure to 2006 vintage HE ABS.
ABN Amro has merged its origination team into one structured finance group. The new team will be run by Mike Nawas and will be responsible for structured capital, asset-backed securities, cross-border finance and the origination and syndication of loans. Nawas was previously head of fixed income capital markets, which has been combined with structured lending under Martyn Powell, who will continue to run that team and report to Nawas, who in turn reports to Gary Page, head of global markets. By fully integrating its operation, ABN Amro's expertise at creating client solutions in the fixed income markets can be further enhanced by its origination capabilities across fixed income capital markets and structured lending. "We are creating a more integrated approach to pitching debt solutions rather than pitching on a product-by-product basis," Page said in a memo sent out earlier this month. A spokesman at the bank said the move would not impact head count.
MBIA has reorganized its executive management team. William Fallon, managing director and head of corporate strategy, was named head of global structured finance, replacing Mark Zucker, who is leaving the company to pursue other interests. Neil Budnick, president of MBIA, will also leave the company. Both men are slated to depart the firm on April 30. Charlie Williams, managing director and head of investor relations, will retire on March 31. MBIA named Willard Hill, managing director and chief compliance officer, to assume responsibility for investor relations. The company also named Hill chief marketing and communications officer.
Citigroup Global Markets has aligned its non-real estate and non-mortgage securitization divisions under its Global Securitized Products (GSP). This group, which will be headed by Ted Yarbrough, will include the firm's asset-backed finance, asset-backed commercial paper conduit and student loan finance units. As head of these groups, Yarbrough will be reporting into Jeff Perlowitz, who is head of securitization at the bank. Under the newly formed unit, Lalie Clark heads up North American conduit origination. Jeff Cady and Christian Anderson are co-heads of asset-backed finance and Paul Sheldon and Mark Weadick are co-heads of student loan finance. Jim Murray is head of global conduit operations, and John Dahl is head of Asia-Pacific securitization. Michiaki Ishiguro is head of Japanese securitization, and Drew Riethmuller is head of European conduit origination. All of them are reporting into Yarbrough. Dahl, Ishiguro and Riethmuller will also retain their respective regional reporting lines.
Law firm McKee Nelson LLP is expanding its operations with the addition of six partners who will be focusing on defending lawsuits involving complex financial deals. The litigation defense group is expected to complement McKee Nelson's capital markets practice. Led by Jeffrey Smith and including Steven Brody, Susan DiCicco, Scott Eckas, Michael Gordon, and Jennifer Hurley McGay, the new business litigation partners come to McKee from the New York office of King & Spalding. When fully staffed, the group will be composed of about 25 lawyers and will increase the number of McKee Nelson lawyers to more than 200. Reed Auerbach, managing partner of McKee Nelson's New York office and a leader of the firm's capital markets practice, noted, "A huge portion of the U.S. economy is financed by complex securities transactions. They almost always work as anticipated, but in those rare cases in which a deal goes wrong, the cost to the participants can be enormous. Successfully managing a problem transaction requires experienced litigators who also have a deep understanding of both the capital markets and complex transactions. Our new partners have those unique qualifications."
Salvatore Zaffino, chairman of Guy Carpenter & Co., a reinsurer that operates an investment-banking specialty and distributes insurance-linked notes to investors, retired from the company last week. Zaffino was appointed chairman in 1999, and will continue as a consultant with senior management at Guy Carpenter and its parent company, Marsh & McLennan Cos. Previously, Zaffino was chairman and CEO of Sedgwick Re North America and chairman of Crump Re, an organization that he created and managed until it merged with Sedgwick Re.
Turkiye Is Bankasi (Isbank) is supposedly preparing a transaction backed by diversified payments rights (DPRs) and led jointly by Citigroup and ABN Amro. One market source away from the deal said the size would probably end up around $550 million in total. The transaction is expected to be unwrapped. Another market source away from the transaction said that a portion of the deal might be dropped into Panterra, a conduit run by Citicorp North America.
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