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[NEW YORK] Anshu Jain, the former Deutsche Bank AG co-chief executive officer, is joining Cantor Fitzgerald LP as president, restarting his career at a much smaller firm after leaving Germany's largest bank amid mounting legal and regulatory problems.
Mr Jain, 53, will help the closely held company expand in areas including fixed-income and equities trading as well as prime brokerage, Cantor chairman and CEO Howard W Lutnick said Monday in a phone interview. The firm is looking to capitalise as stiff regulations force global investment banks, including many in Europe, to pare businesses and pull back from some clients.
"The ability for us to do business with those accounts is a great opportunity," Mr Lutnick said. "We have a great fixed-income business in America, but we'll expand the number of products in which we'll do business with our clients. In Europe, we'll grow our investment banking business, taking Cantor Fitzgerald into the next level." And the firm aims to grow in Asia, he said.
Mr Jain helped build Deutsche Bank into Europe's biggest securities firm over two decades before stepping down in June 2015 as profitability suffered amid a trading slump, stiffer regulation and years of government probes. His successor, John Cryan, has since scrapped bonus awards for top management, suspended dividend payments, pledged to eliminate thousands of jobs and cut risk-weighted assets at the securities unit to restore investor confidence.
Mr Jain said in February he would advise online lender Social Finance Inc, following former Wall Street leaders John Mack and Vikram Pandit in focusing on Silicon Valley ventures looking to disrupt traditional banks. Now, he's jumping to a scrappy Wall Street underdog that survived against long odds after the Sept 11, 2001, terrorist attacks killed 658 of its employees - more than two-thirds of its New York-based workforce.
Mr Lutnick, 55, rebuilt the firm over more than a decade, sometimes hiring in areas that fell out of favour at bigger investment banks after the 2008 financial crisis. Its core Wall Street business employs about 1,600 people and runs trading desks in financial centres around the globe, according to its website, while the broader company - including a variety of financial services and real estate operations - employs more than 10,000 globally.
"I have long admired Howard's extraordinary leadership and successful efforts as he and his team rebuilt and expanded," Mr Jain said in a statement. "As a leading non-bank financial institution, with cutting-edge technology and a global reach, Cantor is well-positioned to capitalise on the changing financial landscape."
Mr Lutnick said he became friends with Mr Jain over the past five years and that by late last summer they began talking about the possibility of Mr Jain signing on. He will assume his new post in the coming weeks and work from London, according to a company spokeswoman. Mr Lutnick held the president title in the 1990s.
The firm intends to increase the capital it uses to handle client business, according to the statement. It hasn't yet finalised plans for raising the additional funds, Mr Lutnick said. Enlisting Mr Jain shouldn't be seen as an attempt to build something in Deutsche Bank's image, he said.
"This is Anshu doing something different," Mr Lutnick said. "He's already run Deutsche Bank. He's not trying to recreate that. He's trying to do something different, and something with a different client focus." Shawn Matthews will remain head of Cantor Fitzgerald & Co, the broker-dealer unit.
In the past year he's hired leaders for its debt capital markets business, and he brought on Jefferies Group trader Rohit Bansal to lead a distressed-debt trading group, adding to its leveraged-finance team. The firm added veteran salesmen from Deutsche Bank and Barclays Plc in November to bulk up its fixed-income team in New York.
Cantor has also been hiring talent abroad in recent years, adding executives in London. And Mr Lutnick has been seeking to expand subsidiaries including BGC Partners Inc, which in 2015 won an agreement to buy interdealer broker GFI Group Inc to help handle large trades between banks.
Mr Jain joined Deutsche Bank in 1995 and rose to lead a corporate and investment banking division that produced most of the company's revenue. In 2012, he became co-CEO succeeding Josef Ackermann, who had held the top spot for a decade. A cascade of bad news followed as Mr Jain and co-CEO Juergen Fitschen worked to shore up the bank's capital, cut costs and boost returns.
The lender was probed for tax evasion in carbon markets, raided by the police and ordered to pay US$2.5 billion for its role in rigging benchmark interest rates known as Libor.
Within weeks of the Libor settlement, Mr Jain emerged from the annual shareholder meeting with the lowest backing for management by investors in more than a decade. After he stepped down as co-CEO, an executive shakeup followed that saw the exit of other board members and investment-bank leaders.
Last month, Deutsche Bank agreed to a US$7.2 billion settlement to end a US investigation into its sales of the mortgage securities that helped fuel the 2008 financial crisis.
Germany's biggest bank still faces probes into whether it manipulated foreign-currency rates and precious metals prices and whether it facilitated transactions that helped investors illegally transfer billions of dollars out of Russia.