Bloomberg News

JPMorgan Combines U.S. Leveraged Loan Sales Teams Under McCann

June 23, 2011

June 23 (Bloomberg) -- JPMorgan Chase & Co., the second- largest underwriter of U.S. leveraged loans this year, combined its loan sales force into one team under Tony McCann, head of U.S. leveraged-finance sales.

The group that was responsible for selling institutional loans in the new-issue market will now work with members of the team that sells the debt in the secondary market, according to Justin Perras, a New York-based spokesman for JPMorgan.

JPMorgan is combining the two teams in order to better serve clients by providing a single point of contact to buy both new-issue and secondary loans. Investors have poured $22.6 billion this year into funds that buy high-yield loans and bonds, while traditional loan-only buyers like collateralized loan obligations have raised $4 billion in funds during the same time period, according to Lipper FMI and data compiled by Bloomberg.

“There’s more product flowing through our desk,” Tim Donahue, head of leveraged finance capital markets at JPMorgan, said in a telephone interview. “While all of our capital markets people need to be facile across both products, given the convergence of the two asset classes it’s hard to be an expert across both when there may be 50 deals in the loan market and 10-20 bond deals at any one time. We’re trying to be more systematic about having product specializations.”

New York-based JPMorgan has a 14.8 percent market share and has underwritten $50.2 billion of leveraged loans this year as of today in the U.S., Bloomberg data show. Bank of America Corp. is the largest underwriter of the debt.

Capital Markets Expansion

There have been $339.9 billion of leveraged loans, those rated below BBB- by Standard & Poor’s and less than Baa3 at Moody’s Investors Service, issued in the U.S. this year as of June 23, Bloomberg data show. That’s a 171.5 percent increase from the same time period in 2010, according to the data.

Kate Flynn and Rob Dorr, both previously responsible for new-issue loan sales, will now report to New York-based McCann.

Chris Bonner will take on a newly created loan syndicate role that will coordinate all of the bank’s capital markets and the sale of new-issue transactions.

The capital markets group led by Donahue is also expanding with the hiring of Jeff Abt, who is joining from the Royal Bank of Canada, according to Perras. The bank is also transferring Rick Gabriel and Kevin Foley to the team.

“We’d like to set our team up to continue to capture and grow our share,” Donahue said.

--Editors: Faris Khan, Chapin Wright

To contact the reporter on this story: Krista Giovacco in New York at kgiovacco1@bloomberg.net; Kristen Haunss in New York at khaunss@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net.


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