Municipal bond issuance is projected by many analysts to hit record numbers this year, and Cantor Fitzgerald & Co. wants in.
In a move the firm yesterday called its “formal entry” into the public finance business, William O’Keefe was named managing director and department head of the muni desk earlier this month.
Prior to joining Cantor, O’Keefe was head of tax-exempt securities at Morgan Stanley, where he worked from 1985 to 2005. In the interim he worked for a short time on the buy side at Williams Jones & Associates, an investment advisory firm in New York.
O’Keefe was vice chairman of the Bond Market Association’s municipal securities division in 2005.
He is also a former board member of the Municipal Securities Rulemaking Board, and in 2000 he was a founding member of MuniCenter — the first electronic marketplace for municipal securities.
Cantor Fitzgerald has operated a municipal sales and trading group since 2004, but the firm has only been underwriter on one transaction, Thomson Reuters data shows.
In 2004, Cantor executives said the firm planned to cater to institutional investors, a message reiterated yesterday.
Hiring O’Keefe “solidifies our entry into the municipal bond market as we continue to expand our first-class capital markets business,” Shawn Matthews, Cantor’s chief executive officer, said in a statement.
The entry will be gradual, however, as the goal is to establish a greater presence in sales and trading before it begins underwriting muni transactions.
“We need sales and trading and an underwriting desk before we can be in the public finance market, so we’re in the process of doing that — growing the sales group, adding trading capacity, and at the same time we’ll be talking to public finance candidates,” O’Keefe said.
The firm plans on doing institutional business wherever possible depending on market opportunities.
“Cantor’s brand name is strong in the metropolitan area but we have branch offices across the county in every metropolitan area, so there’s no reason why we can’t do public finance business in all the big cities and all the big states,” O’Keefe said.
Melanie Gordon-Felsman, vice president of communications and marketing, added: “Cantor has not been in a position where we’ve been slowed down by the financial crisis; it’s been quite the opposite ... we’ve hired over 200 professionals, and we’ve taken advantage of the financial crisis to get the best of the best like Bill onto our team.”
David McMahon, another Morgan Stanley veteran of more than two decades, joined the team as sales manager. Others hired include Sandy Carrithers, who brings 24 years of experience in trading, sales, and public finance at Citi and PaineWebber, and Chris Grinnell, who has 19 years of sales experience at Morgan Stanley.
Steve Kennedy also joined after working previously with Sovereign Securities and Commerce Capital Markets. Elizabeth Andreev joined after last working at Susquehanna International Group as a municipal bond trader.
Kevin Steinhauer and Mike Allen are the only two team members who were already at Cantor.
Steinhauer has overseen Cantor’s municipal trading activities since 2004, and Allen joined the firm’s Memphis office last summer after many years at FTN Securities.
