Jefferies Adds to Financial Institutions Investment Banking
In an effort to boost it's investment banking business, Jefferies has nabbed veteran debt capital markets banker Casper Bntinnck to lead the firm's Financial Institutions Debt Capital Markets business based in New York.
In a press release, Jeffries Global Head of Investment Banking and Capital Markets, Benjamin L. Lorello said, "during the last 12 months, we have extensively built out our Financial Institutions investment banking business across the banks and depository sector, capital structure advisory and equity capital markets origination."
Lorello added that tthe addition of Bentinck represents the logical expansion of our FIG business into the origination of debt capital markets products for our clients."
The announcement comes on the heels of an analyst report from Sandler, O'Neill & Partners published in Barrons that predicted Jefferies will report a 20% sequential increase in debt-underwriting revenue for the second quarter.
Frank Cicero, Global Head of Financial Institutions Investment Banking at Jefferies said, "Caspar will work closely with our FIG coverage and capital structure advisory teams to assist our clients in originating and structuring debt and hybrid capital transactions."
Bentinck had been Managing Director and led the Debt Capital Markets effort for Depository Institutions in the FIG Capital Markets & Financing Group at Bank of America Merrill Lynch. Before that he spent eight years at Lehman Brothers in their High Grade Syndicate Group in New York and London. He received his MBA from the Stern School of Business at New York University and his BA from the University of Pennsylvania.
Earlier this week, Sandler O'neill analysts Jeff Harte and Ted Holzman issued a report saying they were reducing their earnings-per-share estimate for Jefferies Group's May-ended second-quarter 2011 from 45 cents to 39 cents. they also reduced their EPS estimates of Jefferies for the remainder of 2011 and 2012 to reflect the acquisition of Prudential Bache, formerly a subsidiary of Prudential Financial.
The analysts said the combined impact of the capital raise and Prudential Bache acquisition drive our 2012 EPS estimate down 4% from $1.90 to $1.82. they added that it's important to remember Prudential Bache is a large futures commission merchant and that earnings should increase significantly when interest rates eventually increase.
They also said they expect equity-trading revenue to decline sequentially amid flat to declining market valuations. Both average equity-trading volumes and intraday volatility improved modestly after declining for three consecutive quarters. And that fixed-income trading should also decline sequentially as volumes slowed and spreads widened.