Macquarie Asia Head of Investment Banking Desai to Leave

Macquarie's Asia Head of Investment Banking Kalpana Desai
Kalpana Desai, head of Macquarie Group Ltd.'s investment banking in Asia. Source: Macquarie Group Ltd. via Bloomberg

Macquarie Group Ltd.’s head of investment banking in Asia, Kalpana Desai, is leaving after three years with the company amid a widening exodus of dealmakers from the industry.

Desai, 45, will retire as head of Macquarie Capital Asia effective in April to spend time with her family, according to an internal memo obtained by Bloomberg News. Fiona McDonald, a spokeswoman for the Sydney-based bank, declined to comment.

Senior banking executives including Gaby Abdelnour of JPMorgan Chase & Co. and Goldman Sachs Group Inc.’s Yusuf Alireza have left investment banking in the past year, as deals dried up and compensation fell. Macquarie, Australia’s largest investment bank, said in July that its securities unit will probably post a second straight annual loss as Europe’s debt contagion dents appetite for trading and share sales.

“With the changes taking place in the investment banking model, senior bankers are now asking the question: What is next for me in these changing times?” said David Webbe, a senior client partner at Korn/Ferry International, a global executive search firm.

Macquarie’s Chief Executive Officer Nicholas Moore in July described the securities market as “very, very tough” and said he didn’t expect the European crisis to improve soon.

Alex Harvey, who was made CEO of Macquarie’s Asian operations in January, will assume Desai’s role, according to the memo. That will leave the firm’s Asian operations with a similar leadership structure to those in Europe, the Middle East and Africa.

Macquarie’s ranking in underwriting share sales in Asia fell to 23rd this year from 11th in 2010, the first full year after Desai assumed her position, data compiled by Bloomberg show. The rankings exclude offerings in China, where Macquarie lacks a joint venture required to underwrite stock sales.

Fees Slump

In mergers advisory, Macquarie has slipped to 54th in Asia from No. 16 in 2010, according to data that includes China. The global investment banking unit accounted for 8.9 percent of the group’s revenue for the year ended March 31.

Macquarie ranked 11th in Asia equity underwriting and 41st in mergers advisory in 2009, the data show.

Investment-banking fees in the Asia-Pacific region slumped to $10.6 billion in the nine months through September from $12.4 billion in the year-earlier period, according to data from researcher Freeman & Co.

Banks have lost some of their allure as employers after stricter capital rule and a drop in fees restricted their ability to pay. Morgan Stanley and Goldman Sachs Group Inc. are among investment banks that have announced cuts in overall compensation this year.

Vietnam, Pakistan

In the past two years, Desai helped forge alliances with local partners in Vietnam, Pakistan and Thailand to cooperate in investment banking and securities operations including cash equity sales and trading. In October 2011, Macquarie announced an agreement with Bank Julius Baer & Co. Ltd. to develop a wealth management business with the Zurich-based firm.

Desai joined Macquarie in October 2009 after working for 11 years at Merrill Lynch & Co., now part of Bank of America Corp. At Macquarie, she oversaw mergers advisory, equity and debt capital markets and principal investment in 13 countries.

Desai started her career in investment banking in London and is a graduate of the London School of Economics. She is married with three children.

“When I started work in Asia in 2002, Kalpana was already a very high-profile banker,” Webbe said. “Bankers in any case reach a certain stage in their life when they have decided it’s time to leave.”

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