Athanassios Diplas, the global head of systemic risk management at Deutsche Bank AG (DBK), is leaving the firm as of today, according to a person familiar with the decision.
Diplas, co-chairman of the International Swaps and Derivatives Association’s Industry Governance Committee, has helped lead market efforts to reform the $648 trillion swaps market, mostly related to credit-default swaps, and spoke on behalf of ISDA and Deutsche Bank at industry forums. Amanda Williams, a spokeswoman for the bank, declined to comment, as did Diplas.
The world’s largest banks are facing the first regulation of the swaps market since it was invented by the lenders in the 1980s. The September 2008 bankruptcy of Lehman Brothers Holdings Inc. and the collapse of Bear Stearns Cos. six months earlier, both of which were among the largest dealers of privately negotiated derivatives, shook investor confidence in the market and prompted Congress to overhaul trading practices in an effort to reduce systemic risk.
Robert Lee will replace Diplas with a new role in the bank focused on the U.S., the person said.
Deutsche Bank is cutting costs by $5.8 billion as it aims to increase its after-tax return on equity to at least 12 percent by 2015, the Frankfurt-based lender said last month. The lender said in July that it will eliminate 1,900 jobs, including 1,500 at the investment bank and support areas, by year-end as Chief Executive Officers Anshu Jain and Juergen Fitschen face declining revenue from the unit.
Diplas, 47, helped Deutsche Bank cut trade confirmation times in the credit-swaps market in 2005, as the firm and its Wall Street competitors were under pressure from Timothy Geithner, then the President of the Federal Reserve Bank of New York, to speed up transactions that were taking the equivalent of 17 days to complete.
Along with JPMorgan Chase & Co. (JPM)’s Tom Benison, Diplas also helped create ISDA’s credit-steering committee as the financial crisis loomed in 2008. A year later, the panel re-engineered how credit-default swaps work, overseeing the industry’s so-called ‘Big Bang’ protocol that made it possible to process the transactions with clearinghouses.
Diplas, an amateur pilot, previously worked at Goldman Sachs Group Inc. (GS), where he was an emerging markets derivatives trader, Financial Industry Regulatory Authority records show. He was among the first credit-derivatives traders at Goldman Sachs, where he also managed a book of the firm’s counterparty risks.