Both BNP Paribas and Barclays Capital are beefing up their push into the highly competitive US fixed-income markets by setting up new regional offices there to get closer to key institutional clients. Barclays Capital CEO Bob Diamond opened his bank’s new institutional sales office in Boston at the beginning of last month and BNP Paribas set up a fixed-income institutional sales desk in San Francisco at the end of June.
The Boston office will have six staff serving the northeast of the US, led by Tom Dimond and Robert Earl, both hired from Goldman Sachs in April. Dimond will be responsible for investment-grade credit products and Earl will cover cash and derivatives rates coverage. BNP Paribas has moved Ken Austin, a director in its credit derivatives business in New York, to San Francisco to head the new operation and has appointed two new sales people. It has hired Deborah Kelley, previously managing director of fixed-income sales at ABN Amro, as a director and Jonathan Saunders from Banc One Capital Markets as an associate.
Both foreign banks have stressed the importance of being geographically close to major institutional clients to improve investor coverage and grow their US fixed-income businesses. Barclays Capital already had four other fixed-income sales offices in the US but Barclays Capital’s Diamond points out that seven of the largest 25 money managers in the US are based in Boston.
Western coverage
BNP Paribas’ Austin points out that a large proportion of US assets under management are located on the west coast and that having an office in San Francisco is crucial, not just to service the largest institutional clients such as Calpers but also clients in all the western states. ?We are looking to provide a full range of services to our clients throughout the western region,? he says. ?We specifically plan to service asset managers, insurance companies, state funds and corporations with a broad base of fixed-income products.? These will include cash corporate bonds, credit default swaps, repurchase agreements, structured products, private placements and interest rate products.
Barclays Capital now has fixed-income sales bases in all the biggest buy-side centres ? New York, Chicago, Boston and San Francisco ? and has also branched out into Miami. BNP Paribas now has three regional sales offices, in San Francisco, New York and Chicago, but it is thought that the bank deems this sufficient and will not be adding any more sales offices in the foreseeable future. Rather, it will focus on expanding the ones it has. Austin says the bank is looking to hire a fourth person to cover interest rate sales in San Francisco and then plans to add staff as the business grows. ?We’re going to establish our regional group and look to build from that base over time,? he says.
