Royal Bank of Scotland Group Plc, Britain’s largest state-owned lender, is winding down a distressed-debt unit as it scales back its investment bank to revive profitability, according to three people familiar with the matter.
Jon Weiss, who was appointed global head of a special situations group after joining RBS’s Stamford, Connecticut, office in 2008, left this month, the people said. His departure comes as the firm sells off some of its riskier investments and prepares to cut the distressed unit, two of the people said.
RBS, based in Edinburgh, faces political pressure to reduce bonuses and is shrinking its U.S. investment bank before stiffer capital rules are implemented. Richard Dalessio, who was a director in the U.S. special situations unit, exited last month to join Jefferies LLC, people familiar with the matter said at the time.
“We are materially reducing our special situations group,” Sarah Lukashok, a spokeswoman for RBS, said in a telephone interview. Weiss couldn’t immediately be reached.
Weiss joined RBS from Bear Stearns Cos., where he’d worked since 1999, according to Financial Industry Regulatory Authority records. He was promoted to head the special situations group in 2012.
Dollar-denominated distressed debt has returned 276 percent since the end of 2008, and 6.9 percent this year, according to Bank of America Merrill Lynch index data.