Yesterday’s appearance of a tanned and erudite (if not entirely relaxed) Bill Winters in front of the UK Parliamentary Commission on Banking Standards, was a reminder that the popular JP Morgan banker hasn’t faded into obscurity as Jamie Dimon might have hoped.
American by birth, Bill Winters was the London-based co-head of JPMorgan’s investment bank until he was ousted by Jamie Dimon in 2009. According to various reports at the time, Winters was very popular within Dimon’s domain. He was also said to be an excellent risk manager and to have raised the alarm early about the risks being taken by JPMorgan’s chief investment office which resulted in losses of more than $6bn last year. After Bob Diamond left Barclays, Winters was said to be the favoured candidate to replace him as chief executive.
Winters didn’t respond to Barclay’s overtures. Instead, he set up Renshaw Bay, which describes itself as an, ‘independent asset management and advisory firm focused on investment opportunities resulting from dislocations and structural changes resulting from dislocations in capital markets.’
The FSA Register shows that since Renshaw Bay was authorised in November 2011, it’s added 16 registered people, of whom five have joined since September 2012.
Renshaw Bay and Bill Winters didn’t respond to a request to discuss future hiring plans for this article. However, recent recruits include junior and compliance staff, suggesting the firm may be building out in support roles. William Kostoris joined after two years at Numis. Karina Cooper joined in a compliance role from Aspect Capital. At a more senior level, Winters also hired Venu Thirunamachandran, fomerly head of global fixed income hybrids and exotics at JPMorgan, and Martin Farinola, formerly of Goldman Sachs.
Many of the early hires at Renshaw Bay were real estate bankers who joined Renshaw Bay’s European real estate debt platform. Supplementary to hires shown on the FSA register, in the past three months Winters has also hired Frank Soussan, a former hybrid credit trader at JPMorgan, Pierre Leocadio, a former FIG banker from UBS and Vesa Poikonen, a quantitative and credit analyst from RBS, suggesting expansion is continuing into other areas.
Despite being a small firm that is unlikely to feature highly on the FSA’s radar, Renshaw Bay publishes its remuneration policy and says it defers some of its compensation.
Winters has given no indication that he intends to assume another senior position in a large investment bank. During yesterday’s parliamentary appearance he said US banks are at an advantage compared to European banks because US banks are perceived by investors as being underpinned by the US ‘sovereign’ whereas the UK government in particular has made it clear that it would not bail out a bank again. As a result, he said US banks’ cost of funding is lower.
Winters also alluded to problems at JPMorgan when it merged with Chase in 2000. “Retail bankers look over at the highly paid traders and think, ‘Why can’t I have that?'”, said Winters. “They don’t realise that three out of ten of those traders will lose their jobs in the next year,” he added.