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BBVA: Staying ahead?

Emerging markets hedge funds returned more than any other strategy in March, producing 4.63%, according to HFR, ending eight months of continuous losses. In 2008, average losses of emerging market hedge funds were nearly 37%, and investors withdrew $6.7 billion from them in the fourth quarter. Total hedge fund capital committed to emerging markets fell to less than $67 billion globally.

Venezuelan president Hugo Chávez is finally turning to the private sector to prop up the country’s increasingly insipid economy, creating a strange relationship between the bankers and a socialist government that continually threatens to nationalize them. Chávez is pressuring the banks to buy the $15.8 billion the government plans to issue in local debt in 2009. The money is essential to Chávez’s plan to prop up the economy in the face of falling oil prices. The president appeared to deliver a veiled threat when he restated plans to privatize Banco Santander’s local offshoot at the same time as announcing the new economic funding. Analysts expect bankers to comply with his demands.

Much pressure has been placed on many market participants’ back offices as a result of the rapid expansion in foreign exchange trading volumes over the past few years.

The sale of Pactual could be the first of many disposals of emerging markets assets by banks desperate to raise capital.

Asset manager BlackRock is absorbing $1.5 billion credit manager R3 Capital Management. R3 was founded by former Lehman Brothers executive Rick Rieder. The beleaguered investment bank also sold about $5 billion in assets to R3 to manage last summer in return for a stake that it was later forced to sell under bankruptcy proceedings. In a letter to investors, BlackRock senior management stressed the importance of having the right employees and resources in order to take advantage of increased opportunities in mortgages and structured assets that are trading at distressed levels. The firm also hired Akiva Dickstein from Merrill Lynch to head its mortgage portfolio team and Randy Robertson from Wachovia to co-head its securitized assets team.

Latest figures show that new hedge fund launches and the total assets raised were both hit by the economic downturn. Neil Wilson reports.

Cheyne Capital, a $6 billion European hedge fund, has hired Chris Goekjian as its new chief investment officer. Goekjian was head of global fixed income at Credit Suisse’s investment banking arm until 2001 when he left to set up fund of funds Altedge Capital. Altedge is to be integrated into Cheyne as part of the hire.

Richard Leighton has now assumed responsibility for fixed income Europe at Standard Chartered, as well as continuing to run FX globally. "Last year, our business in Europe grew an impressive 143%. To ensure our continued ability to build on our success and take our business to the next level, we will be strengthening our organization by aligning our structure with that in place in Americas, MENA and Africa and appointing Richard Leighton as head of trading for fixed income for Europe," says an internal memo, quashing talk that Leighton is going to retire.

The well-liked and respected George Athanasopoulos has decided to leave Barclays Capital, where he was global head of FX and emerging markets distribution. Sources say Athanasopoulos is working his notice before heading back to Greece; he is expected to stay in the financial industry, most likely working for a buy-side entity.

It was no secret in the market that dissatisfaction at UniCredit, a conglomerate formed by the merger of about 20 different financial institutions, rose sharply after the bank told its FX staff by email that none of them would be receiving any form of bonus for their performance in 2008. This was despite the business having what insiders say was a very good year. Sources suggest that the move was one of the factors that prompted the departure of Ben Welsh from the bank in early April. Welsh was hired in September 2007 at a time when hopes were high within UniCredit that it would be able to meld together its numerous disparate parts and capitalize on what it described as its size and distribution network.