Barclays' hiring spree

[LondonPete]

In today's FT:



[b]City investors keen to view looming banking showdown[/b]



Of the many opaque corners of the financial markets, the world of structured finance is probably least often exposed to the light of day. Although the value of outstanding credit derivatives contracts is now estimated at more than $3,000bn (£1,575bn) worldwide, many of these receive little external scrutiny.



That is one of the reasons why many investors and traders are keeping a close eye on the bitter legal battle between Barclays Capital, the investment banking arm of the British bank, and HSH Nordbank, the state-owned German bank that was created last year through the merger of two smaller lenders. Unless the two sides can hammer out a settlement, they are due to argue their differences in a London court in early February.

[b]

…


[/b] The immediate subject of the February court case is LB Kiel's $151m investment in Corvus. HSH alleges that it was misled about the nature of the CDO, and that the entity was subsequently mismanaged, especially in the period after September 11 2001 when the credit markets took a beating. The case does not cover the other $420m that was invested by LB Hamburg in another Barclays CDO called Nerva, though HSH says it is reviewing legal proceedings.



According to people close to HSH, the Barclays team created a series of interlocking CDOs, some of which were never offered to external investors, which had the effect of exposing HSH to risky credits such as aircraft leases and loans for manufactured housing without the bank's knowledge. When the underlying securities began to deteriorate, they triggered a cascade of downgrades by Fitch, the rating agency. The collapse was so rapid that within less than three years Corvus notes that had been assigned an AAA rating in December 2000 had been reduced to "junk" status.



Full article: http://news.ft.com/cms/s/20cf424e-5df6-11d9-ac01-00000e2511c8.html

[LondonPete]

[b]RE: Barclays' Hiring Spree...[/b]



[i][b]Targeting[/b] [b]300 New Hires[/b][/i]

? Seeking opportunities for expansion of client offering in adjacent and complementary product types

[b]? Mortgages (CMBS & RMBS)

? Commodities

? Leveraged finance/high yield
[/b]? Continuing to capitalise on synergies with BGI in terms of client contact and product structuring

? Continuing to Focus on Good Control and Governance

? Planned Move to Whippany NJ - long term strategy for expansion and business continuity



This is from a (content rich) March 2004 BarCap presentation for a US audience http://www.investorrelations.barclays.co.uk/INV/A/Content/Files/Investor_2004_USvisit.pdf

[baghead]

reviving this old thread...



In retrospect, the below comments on upsizing CMBS sound scary.

Anyway, from what we have seen recently looks like they gonna come out of it ok-ish.



Nonetheless, it looks like their hiring spree continues.

"the Wall Street Journal quotes Jerry del Missier, co-president of Barclays Capital in the UK, as saying he plans to add 1,500 staff"

http://news.efinancialcareers.co.uk/NEWS_ITEM/newsItemId-11974



friend of mine is in touch with their Equity Exotics desk in London.

I heard good things about them but couldn't provide enough details.

any views? granchio, Nonius?

[rowdyroddypiper]

They already hired in a pair of big guns to run their US CMBS effort.  Their first big loan (on 666 Fifth Avenue) probably has put them behind the eight ball profitability wise for the forseeable future.  They don't have their own shelf (to issue deals from) and were effectively trying to pay other issuers to include it in their deals.  I am not sure how much was successfully securitized and at what levels, but anything they have left on their book is probably 7-8 points underwater in this environment.

[arkestra]

[i]friend of mine is in touch with their Equity Exotics desk in London.

I heard good things about them but couldn't provide enough details.

any views?[/i]



The head trader in Barcap Eq Ex desk is a v good thing. Clever. Doing a good job of improving an area that's seen a lot of rapid expansion, with all the organisational/technical strain that implies. Barcap in general has a lot of good people, also a lot of the hassle necessarily attendant on expanding so fast. Caveat emptor, make sure you get a decent lowdown on whatever particular area of Barcap you're looking at since they vary a [b]lot[/b].

[granchio]

>The head trader in Barcap Eq Ex desk is a v good thing. Clever.



still the guy ex CS?

[gw33]

yep - and they are indeed making rather good headway.

[granchio]

interesting. we see them less and less

[dopivo]

Hi, thanks for the below comments on Barcap. I interviewed with them recently and thought I give a quick summary.



I was talking to Neal who reports the Greek CS guy you are referring to.



It was a quite technical interview and I was quizzed on gap-risk pricing and hedging of CPPIs, hybrids modelling and light Equity Exotics (vega of zero-strike worst-of etc.)



Happy to provide further details via email if anyone is interested.



Happy New Year!