Goldman Changes Asia Banking Leadership as New CEO Digs In
21 October 2018 - 3:25AM
Dow Jones News
By Julie Steinberg in Hong Kong and Liz Hoffman in New York
Goldman Sachs Group Inc. is shaking up its leadership in Asia,
where a high-profile corruption scandal has dampened an otherwise
strong stretch of deal-making.
Andrea Vella and Kate Richdale, Goldman's investment banking
chiefs in the region, are being shifted out of management roles,
according to people familiar with the matter. They will be replaced
by Todd Leland, an adviser to European banks and asset managers who
was tapped last year to help run Goldman's operations in Asia.
Management changes have come quickly under David Solomon, who
took over Oct. 1 as Goldman's chief executive. The firm has named a
new president, replaced its chief financial officer, put two new
executives in charge of its trading business, and begun to change
the way it covers its most important clients.
Mr. Vella, an Italian-born banker, has been closely involved in
a pair of recent black eyes for Goldman's investment bank. He
structured a Malaysian bond offering that has ensnared Goldman in a
sprawling corruption probe that is likely to carry a large
financial penalty. He also worked on a derivative sold to Libya's
sovereign-wealth fund that ended up in court last year. (The firm
was absolved of wrongdoing. The trial, at which Mr. Vella
testified, made public unflattering details about the firm's
dealings with the fund.)
Ms. Richdale joined Goldman in 2013 as a highly touted hire from
Morgan Stanley. Hong Kong-born and fluent in Mandarin, she
developed relationships with regional giants including Singaporean
state investment fund Temasek Holdings Pte. Ltd.
She will move to a role that entails more client face-time,
people familiar with the matter said, relinquishing day-to-day
oversight of the business at a time when Goldman is trying to put
more women in management roles.
Asia has been a tough region for Wall Street firms, despite its
fast-growing economies. Underwriting fees are lower than in the
U.S. and tend to be split among a bigger group of banks. Merger
activity runs hot and cold, with heavy influence from government
officials. In 2016, Goldman laid off dozens of bankers in Asia as
deal volume slowed.
Of Goldman's three geographic divisions, Asia is the smallest
and least profitable. The principal investments that once boosted
returns -- Goldman's ownership stake in the Industrial &
Commercial Bank of China Ltd. was profitable enough to merit its
own line item in the firm's financial reports for years -- have
mostly rolled off.
In 2018's first half, Goldman made $767 million in pre-tax
profits in Asia, Australia and New Zealand, about 11% of the
firmwide total. Asia is a small contributor to overall profits at
most Western banks operating in the region.
Goldman is ranked No. 1 this year in stock underwriting and
M&A in the region, excluding Japan, according to Dealogic. It
helped lead the Chinese IPOs of smartphone maker Xiaomi Corp. and
online-services platform Meituan Dianping, and is a lead
underwriter of Tencent Music Group Entertainment's upcoming listing
in New York.
Mr. Leland, a Midwesterner who has spent time in the U.S. and
London for Goldman, is seen as a steady hand and experienced
banker.
Further down the ranks, executives being primed for bigger roles
include Raghav Maliah, Goldman's head of Asia technology banking;
Aaron Arth, who runs equity capital markets; and Iain Drayton, who
covers private-equity funds and sovereign-wealth funds in the
region, according to people familiar with the matter.
Write to Julie Steinberg at julie.steinberg@wsj.com and Liz
Hoffman at liz.hoffman@wsj.com
(END) Dow Jones Newswires
October 20, 2018 12:10 ET (16:10 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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