CHICAGO -- Morgan Stanley has hired five infrastructure bankers to replenish its public finance ranks after a series of departures.
Martha Linsley, Anirudh Seth, Cabray Haines, Frederick Putnam, and Kevin MacKinnon joined Morgan Stanley.
“This is the right team” of bankers “who have great credentials, a proven track record, and the ability to work well in an integrated team,” public finance department and syndicate head Brian Wynne said in an interview. The firm has ranked fourth nationally among senior managers on negotiated deals for at least the last five years and is third so far this year, according to league tables from Thomson Reuters.
A common thread among the new hires is their banking skills and ability to work in a team that fits the firm’s banking strategy, Wynne said, adding that as he sought out bankers with that in mind, not just existing client relationships and personal deal achievements.
“This type of teamwork is what we found to be working for us. It’s about delivering a full package” that includes “deploying our balance sheet when a client may not yet be ready to do a public transaction," he said. “The business has changed. The future of public finance is going to be teamwork,” where firms integrate public finance relationship banking with other areas like public-private partnership and capital support.
The five new hires include two former Barclays bankers. Linsley joined the firm as an executive director in Chicago and Haines joined the Washington, D.C. office as an executive director. Barclays declined to comment on the departures.
Seth also joined the Chicago office as an executive director. He previously worked at KeyBanc Capital Markets.
In Chicago, Linsley and Seth join William Mack, a longtime banker in the Chicago office, and they fill a void left with the departure earlier this year of William Daley, who moved to Goldman Sachs to lead its Midwest efforts, and Stephen Fortino, who recently followed Daley over to Goldman after 11 years at Morgan Stanley. Linsley will cover top Midwest issuers like Chicago and Illinois.
Haines, who joins Robert Feigenson in D.C., will lead much of the firm’s Mid-Atlantic coverage and assist other regional teams covering the District of Columbia, Connecticut, and Illinois. Anirudh will cover Ohio issuers and the state and other areas.
Linsley and Haines have long worked together. They spent the last seven years at Barclays and held previous banking positions at what’s now Siebert Cisneros Shank & Co. LLC, Mesirow Financial Inc., and the former Lehman Brothers.
Putnam joined the firm as an executive director in New York. He came from UBS and previously spent eight years in JPMorgan’s Northeast Infrastructure Group with a brief break during which he worked at Samuel A. Ramirez & Co., Inc. Putnam will help cover New York State and Massachusetts as well as cover other issuers in the Northeast region.
MacKinnon also joined the New York office. He is an associate. He previously worked at Fengate Capital Management, a Canadian private equity firm specializing in infrastructure. He joins other members in the firm’s public-private partnership group.
“We are confident that the combination of providing larger opportunities for existing members of our group, and the addition of the following individuals, will continue to propel our growth by providing the best solutions to our clients,” said a memorandum Wynne sent to his team late last month that was obtained by The Bond Buyer.
Seth has started at the firm but the other four are on a standard, no-compete garden leave with expected start dates by mid-September.
In addition to the two Chicago banking departures, Morgan Stanley this year lost three other senior bankers who were recruited by Wells Fargo Securities’ public finance head Stratford Shields, who previously led Morgan Stanley’s banking group. They are Chuck Peck, who now heads Wells' West and Midwest regions; Randy Campbell, head of P3 Infrastructure and sports financing; and Jim Perry, who runs the Southern regional group.
With the new hires, the firm is down about three bankers from a year ago. Wynne declined to say how many bankers make up his team. Wynne is a 29-year veteran of Morgan Stanley and has served as head of public finance and syndicate since July 2017 after the departure of his co-head Charlie Visconsi. The two had led the department since 2012.
The team is growing as market participants warn of a coming contraction in banking jobs as firms grapple with declining issuance. First half volume of $161 billion represented a decline of just below 20%. New money is up but refundings are down sharply due to elimination of advance refundings in the Tax Cut and Jobs Act of 2017.
Some believe the toll will prove especially hard on smaller regional firms. Wall Street firms may benefit from multiple product lines but that doesn't mean they are immune from layoffs.
“Volume is way down and it’s going to be a tough rest of the year as our business continues to contract,” said one New Jersey bond trader. “We’re in a situation now where the amount of business getting done out there can’t support our business.” The dearth of paper is curtailing new and secondary sales, which in turn, impacts municipal firms’ capabilities, resources, staff, and productivity.
Wynne said he doesn’t envision any big changes in the firm’s approach to managing its business to adjust to dwindling supply. “Cycles come and go and those” firms that “are consistent in the end win,” he said.
--Christine Albano contributed to this story