Paulson’s Lacoursiere Said to Leave to Start Own Hedge Fund

Robert Lacoursiere, the Paulson & Co. partner who oversaw the $23 billion hedge fund’s team of banking analysts, quit last week after four years to start his own fund, according to a person with knowledge of the matter.

Lacoursiere, 49, plans to start an equity hedge fund within six months that will focus on global financial companies, said the person, who asked not to be identified because the information is private.

Paulson, founded by billionaire John Paulson, suffered record losses last year as his bet on a U.S. economic recovery went awry. The hedge fund last quarter sold entire stakes in Citigroup Inc. and Bank of America Corp., among its largest financial holdings, after the lenders’ performance helped drag down returns in 2011.

“There is cash flowing around for some spinouts, depending on who they are and where they come from,” said Daniel Hunter, a partner at Schulte Roth & Zabel LLP, a New York-based law firm whose clients include hedge funds. “If he is able to sufficiently explain to investors what happened with the portfolio, then he may be in good shape to get money.”

Lacoursiere didn’t make portfolio or investment decisions at Paulson, according to another person familiar with the firm, who asked not to be named because the information isn’t public.

Lacoursiere is the most senior person to depart New York- based Paulson since Paolo Pellegrini left in December 2008 to start his own hedge fund. Pellegrini, who had helped Paulson make more than $3 billion with bets on a U.S. housing crash, incurred losses in 2010 and returned money to clients.

‘Biggest Disappointment’

Lacoursiere, whose banking group had 10 analysts, joined Paulson from Banc of America Securities LLC, a unit of Charlotte, North Carolina-based Bank of America. He had previously worked at Capital One Financial Corp. (COF), Lehman Brothers Holdings Inc. and Bear Stearns Cos.

Paulson lost 51 percent last year in one of his largest funds. The firm told clients in a year-end letter last month that Bank of America was “the biggest disappointment” in the fund’s bank holdings.

Citigroup has gained 34 percent and Bank of America has climbed 46 percent this year following Paulson selling his shares. Paulson had told clients in January 2011 that the fund made more than $1 billion on its Citigroup investment in the prior 18 months.

Paulson’s Advantage Plus Fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, gained 3.5 percent in the first two months of 2012, according to a client update, a copy of which was obtained by Bloomberg News.

To contact the reporters on this story: Tiffany Kary in New York at tkary@bloomberg.net; Saijel Kishan in New York at skishan@bloomberg.net

To contact the editors responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net; John Pickering at jpickering@bloomberg.net