Morgan Stanley made a key risk hire from JPMorgan mid-chaos

To the extent that any one type of employee is critical in current and recent market conditions, market risk professionals specializing in credit are possibly it. Nomura and Deutsche Bank both lost money on writedowns related to credit trades in the first quarter, and if the economy doesn't recover soon there may be plenty more writedowns to come. 

In the circumstances, a new arrival at Morgan Stanley looks interesting. The U.S. bank has hired Billy Keohane, a former VP in market risk for equity derivatives trading at JPMorgan, and made him EMEA head of market risk for credit and securitized products trading. 

For Keohane, who joined quietly in the chaos of April, it looks like a step-up: he's an executive director at Morgan Stanley instead of a VP and manages risk for an entire key product area. 

In its 10Q report for the first quarter, Morgan Stanley noted that COVID-19 caused a rapid deterioration in the "credit environment" resulting in, "mark-to-market losses on held for-sale loans and lending commitments and increased allowances for credit losses related to held-for-investment loans and lending commitments," and that these, "trends could continue in future periods." The bank made an allowance of $530m for credit losses in its institutional securities division over the same period. 

Keohane previously spent his entire 10 year career at JPMorgan, after joining in Dublin in 2010.

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