Would you go from global head of a business at a European bank to a position where you're not even head of a desk at J.P. Morgan? This is what Carl Teece, former global head of precious metals trading at BNP Paribas, has done.
Teece left BNP Paribas in August last year and has just re-emerged at J.P. Morgan, according to the FCA Register. However, whilst he’s still working in precious metals trading, Teece has taken the role of executive director and will not be heading the desk. Going from such a grand title at BNP Paribas to part of the team at J.P. Morgan may appear to be a step down, but perhaps this is what it takes to get in.
Teece was promoted to global head of precious metals trading at BNP in 2012. The French bank lost a raft of traders last year - Teece among them - and more recently has signaled a move away from commodities.
J.P. Morgan was ranked 5th for commodities revenues in 2006, but has been first for the past two years. This is despite the sale of its physical trading arm to Mercuria in 2013.
As we’ve said many times before, J.P. Morgan appears an increasingly attractive option for traders seeking the safety afforded by economies of scale. Daniel Pinto, chief executive of its corporate and investment bank, reiterated again at investor day this week that exiting business areas entirely is a fast track to becoming irrelevant and unprofitable.
This view is supported by Boston Consulting Group, which believes that only investment banking ‘powerhouses’ will have the scale to be present in all markets. Smaller players will either have to specialise or take tough decisions to close down certain business areas, it says.
Prospects for commodities traders in investment banking are reduced, but revenues have at least improved. The fall in the oil price increased turnover in the commodities market last year and spurred a 9% uptick in revenues, according to analysis by industry consultants Coalition, reversing an 18% decline in 2013.
J.P. Morgan declined to comment.