Credit Suisse strengthens funds group

Eighteen individuals have joined the bank's ‘asset management institutional distribution team’ – which includes private equity fund placement and will be led from Europe by Remy Kawkabani – at a time when the value of placement agents is being called into question by some of the industry’s most influential players.

Credit Suisse said it has “largely completed” the expansion of its asset management global institutional distribution team, which includes its private funds group, having brought in a total of 18 professionals. That includes nine managing directors, three of whom previously worked for other Credit Suisse divisions.

Remy Kawkabani

Remy Kawkabani, formerly co-head of the bank’s private funds group in London, assumes responsibility for the institutional distribution group in Europe.

The bank has hired Dave McCann, the former head of relationship investments at the $88 billion Canada Pension Plan Investment Board, to cover Canadian institutions from Toronto, while Richard Johnson joins from Graham Capital Management, a New York-based asset manager with around $4.9 billion under management, to cover Eastern and Central areas of the US.

Filo Sedillo, former head of rival bank Citi’s placement operations in Australia and New Zealand, joins Credit Suisse to cover the region from Sydney, while Jamal Al Naif, formerly head of Cit's Middle Eastern institutional efforts, will lead Middle Eastern activities from Dubai. Sedillo’s and Al Naif's moves coincide with the revelation that Citi will be winding down its 45-strong global third party fund placement team.

As reported earlier today on PEO, Citi will wind the team down by the end of 2009 as the global bank no longer attaches strategic importance to private equity fund placement, according to sources familiar with the situation.

The expansion of Credit Suisse’s team – and the winding down of Citi’s – comes as the value and integrity of third-party placement agents has been called into question by some of the industry’s most influential players.

New York State Common Retirement Fund has banned the use of placement agents, paid intermediaries and registered lobbyists from participating in investments with the $122 billion pension in the wake of a growing kick-back scandal involving the pension. New York City Comptroller William Thompson has asked trustees of the five city pensions, which combined have total assets of about $83 billion, to approve a ban on placement agents as well.

On the GP side, The Carlyle Group, the third largest private equity firm in the world according to the latest PEI 300 ranking, has decided to stop using placement agents to gain commitments from public pension funds.