Merrill Lynch has poached two top corporate finance directors from its investment banking rival Deutsche Morgan Grenfell, as part of the US bank's expansion in the UK following its recent acquisition of Smith New Court.
The defection of Morgan's number one and two in corporate finance, Guy Dawson and Justin Dowley, had nothing to do with rumours of cultural clashes between the UK merchant bank and its German parent, a Morgan spokesman said yesterday.
"They've tendered their resignations. They have been with us for many years, and we wish them well," the Morgan spokesman said.
"We have set up a five-man management committee for corporate finance," he said. "Life goes on."
Deutsche Morgan Grenfell recently lost its entire 20-strong derivatives team to West Merchant Bank, the London subsidiary of its German rival West Deustche Landesbank.
Deutsche decided to base all its global investment banking activities with the Morgan Grenfell subsidiary in London last autumn, since which it has itself pursued an aggressive hiring policy.
Sources close to Merrill insisted that the defectors would be paid "not a single penny more" than they had received at Morgan.
They had left because the American bank had a better strategic vision than Deutsche Morgan Grenfell, and there will be more hirings to make Merrill the leading investment bank in the UK and Europe, the source said.
Guy Dawson said: "Merrill Lynch's international advisory and financing capabilities, combined with their powerful presence in the UK equity and sterling debt markets, gives the firm a competitive edge in serving the varied corporate finance needs of its clients."Reuse content