The former head of JP Morgan’s disbanded transition management team has emerged at a US brokerage that is seeking to enter the market.
Mike Gardner has joined investment bank and brokerage Cantor Fitzgerald as global head of portfolio solutions, the company announced today.
“I expect [Gardner’s] extensive experience and relationships will add tremendous value to our growing franchise.”—Shawn Matthews, Cantor FitzgeraldGardner, who ran JP Morgan’s team until its closure in May 2013, will focus on “assisting asset owners with monitoring, measuring, and managing risk holistically across mandates, geographies, and asset classes”, Cantor Fitzgerald said.
The bank’s CEO, Shawn Matthews, said the firm anticipated “considerable demand for tailored risk management and restructuring solutions” and labelled the venture a “growing franchise”.
Cantor Fitzgerald is the second recent new entrant into a global market that saw many of its major players quit the scene in the past few years.
In May 2013, JP Morgan and Credit Suisse began shuttering their transitions service, shortly followed by ConvergEx. In March 2014, BNY Mellon followed their move. These companies had been some of the largest offering a transitions service.
In June last year, Macquarie picked up several members of the discarded BNY Mellon team, announcing it would push into Europe with a transitions business. In the previous September, the bank had picked up Fred Fogg and Lance Vegna as co-heads of Portfolio Solutions in the Americas—the pair had run Credit Suisse’s regional offering before its withdrawal from the market.
The shakedown of the market came a couple of years after the discovery of episodic overcharging by State Street’s transition management unit, revealed by CIO in late 2011. State Street has since rebuilt its transitions team and is led by another former JP Morgan transitions head, John Minderides. There is no suggestion any other transitions firm was involved in similar practices.
Today, Gardner said the new business at Cantor Fitzgerald had been designed as “a distinctly separate business line, with the aim of creating highly customized services to meet investors’ specific risk, return, correlation, and liquidity objectives, on a platform of their choice.”
For an up-to-date view of the sector, see CIO’s fourth-annual global transition management survey in our September edition.
Related content: Reluctant Voices – CIO‘s first full investigation into the transition management overcharging affair.