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Citi revamps its Singapore prime broking team as the downturn in hedge fund capital raising retards asset growth in the sector
The jury is out on the US government’s convoluted (is it or isn’t it?) bailout of Citi, which one ambivalent hedge fund manager described Monday evening as appearing like “half a loaf”.
However, the US cavalry arrived too late to save the most visible member of its Citi’s prime broking team in Singapore.
That team was headlined by Alexis Fosler who last month won AsianInvestor’s Best Prime Broking Salesperson award in our hedge fund service provider awards.
Fosler had been recognised for a stellar year of bringing in business. Ex-workmates say that she was awarded a $600,000 bonus for 2007. However, her Waterloo was that even though Citi had won a lot of new hedge fund start-up business, given hedge fund capital raising has slammed into a brick wall this summer, those hedge funds had not grown as much as had been hoped. Of the dozens of new mandates, only one evolved into a million-dollar earner.
Coupled with this revenue shortfall, sources say there was also a healthy competitiveness between Singapore-based Fosler and the Hong Kong-based directors of transitions and client service, Jacqueline Fan and Jenny Yau. Fosler came out second best.
Director Paul Weir, who was on the client side in Singapore prime broking, was forced out earlier.
Alex Knight, continues as head of FX prime broking Singapore. Danielle Vint and Jane Ong, are dealing with prime brokerage client services. Citi hails that as evidence of their continued commitment to Singapore, but with their top rainmaker kicked out, it looks like a long road back.
Singapore GIC won’t buy more Citigroup shares – Sources
The Government of Singapore Investment Corp. won’t buy more shares in Citigroup Inc. and its stake will be diluted following the U.S. government’s investment in the banking giant, two people familiar with the situation said Tuesday.
“They (GIC) are not planning to buy more shares in Citi, at least for now. So their stake will be diluted,” one person told Dow Jones Newswires.
GIC, which manages Singapore’s foreign exchange reserves, bought in January $6.88 billion in Citigroup preferred shares which if converted to ordinary shares would give the Singapore sovereign wealth fund a 4% stake in the bank.
The U.S. government said Monday that it would insure up to $306 billion of Citigroup’s troubled assets and pump $20 billion into the bank. In exchange it will get $27 billion in Citigroup preferred shares and $2.7 billion in warrants for ordinary shares.
“After all that’s happened to Citi, GIC prefers the dilution. The view from the top at this point is hold back on investments, especially in the U.S.,” a second person said.
A GIC spokeswoman declined to comment.