Deutsche Bank's Head of Bond Research Abrahams Said Leavingby
Said teaming with Egnatz, formerly of HSBC, to start own firm
Would be latest to exit lender as it trims trading businesses
Steven Abrahams, Deutsche Bank AG’s head of U.S. mortgage-bond and securitization research, is leaving this month after almost six years at the bank as it pulls back from those markets, two people with knowledge of the matter said.
Abrahams is joining Brian Egnatz, former head of HSBC Holdings Plc’s investment portfolio, to start an asset-management firm geared toward commercial-bank clients, said the people, who asked not to be named without authorization to speak.
Deutsche Bank spokeswoman Amanda Williams declined to comment. Abrahams said he couldn’t comment when reached by telephone. Egnatz didn’t respond to messages seeking comment.
Abraham’s departure is the latest example of a mortgage-bond executive leaving the sell-side to start up new ventures. Scott Gimpel, a former top mortgage-bond strategist at Royal Bank of Scotland Group Plc, left RBS in 2014 to start the data and analytics firm Webbs Hill Advisors LLC with former RBS trader Daniel O’Connor. The pair continued an employee exodus from RBS as Britain’s largest state-owned lender scaled back its securities arm.
Abrahams is a former executive of housing company Freddie Mac. He joined Deutsche Bank in 2010 from Citadel Investment Group and was previously a senior managing director at Bear Stearns Cos.
His departure is the latest in a growing number of Deutsche Bank employees trained in U.S. mortgage securities who have departed as the bank follows co-Chief Executive Officer John Cryan’s strategy to exit from capital-intensive businesses. Deutsche Bank is promising shareholders a boost in profitability by reducing headcount by as many as 9,000 by 2018.
"This will be the bank’s first full-year loss since 2008, and it is sobering," Cryan said in a Jan. 20 note to employees posted on the bank’s website. "We expect the next two years to consist of hard work, burdened by the costs of restructuring the bank and making much-needed investments."
At least 10 traders, including two managing directors, separated from the bank’s agency mortgage-bond unit in December, with only a dozen remaining, people with knowledge of the matter said.
They included Manish Kumar, a head of trading who led the bank to the top ranking for collateralized-mortgage obligations in 2012 and 2013; traders Kendrick Croasmun and Peter Gall; and Song Yang, an analyst in Abraham’s research group. Kumar, Croasmun, Gall and Yang confirmed their departures.