New York, NY – The International Association of Credit Portfolio Managers today announced it has re-elected RBC Capital Markets’ Mark Hughes Chair and Deutsche Bank’s Sean Kavanagh Vice Chair. The pair will serve one-year terms through the end of 2010.
Also elected to officer positions, Vipin Ramani of Bank of America was chosen to serve as Treasurer, while Tamar Joulia of ING will remain Secretary.
“For the first time in the Association’s history, the same officers will remain for second terms,” commented Mr. Hughes. “During these uncertain times for the global economy and capital markets, it is reassuring to have the same leadership team back in place, continuing to serve so ably.”
Heading into 2010, the IACPM will continue to work on a number of issues important to its members, including general developments in the capital markets and specific topics impacting the practice of active credit portfolio management. In response to the credit crisis, many credit portfolio management teams are evolving and are being asked by their firms to take on greater responsibility for asset classes outside their traditional focus on large corporate credit portfolios.
“Our members and their firms have substantially changed the ways they view and manage risk,” said Som-lok Leung, Executive Director of the IACPM. “As portfolio managers’ responsibilities expand, the Association is helping them by looking for better ways to perform their function, while helping their firms maximize a balance risk and return.”
On the regulatory front, the IACPM continues to discuss the issue of a new capital penalty imposed under Basel II for hedging credit portfolios with the new CDS contracts standardized for clearing through the new derivatives clearinghouses. Under the new regime, the standardized CDS contract removes restructuring as a credit event and reduces capital relief by 40% for credit positions hedged by these contracts.
“The creation of central clearing counterparties is a very useful development for credit markets” said Som-lok Leung, Executive Director of the IACPM. “It’s ironic, then, that current Basel II rules penalize portfolio managers for hedging credit portfolios with these new contracts. We will continue to discuss this with regulators, and hope to encourage a more rational treatment in the future.”
Association Chair Mark Hughes is Chief Operating Officer and Head of Global Credit for RBC Capital Markets. As COO, Mr. Hughes is responsible for global administration, operational and functional matters for the firm. In his role as Head of Global Credit, Mr. Hughes oversees RBC’s global wholesale loan portfolio. Mr. Hughes received his MBA from Manchester Business School and an LLB from Leeds University in England. He has been with RBC since 1981 and is based in Toronto, Canada.
Vice Chair Sean Kavanagh is responsible for pricing, managing and actively distributing credit risk in his role as Global Head of the Loan Exposure Management Group at Deutsche Bank. Mr. Kavanagh is based in New York. Prior to joining Deutsche Bank, he ran the Credit Trading and Execution function in North America for JP Morgan. Mr. Kavanagh received a Bachelor of Science and Engineering degree in Electrical Engineering and Computer Science from Princeton University.
Also serving on the Board in 2010, the other directors are Jeffrey R. Bohn, Standard Chartered Bank, Steven Buck, Standard Bank of South Africa, Sarah Cheriton, Sumitomo Mitsui Banking Corp, Lori Evangel, MetLife, Christine Helsdon-Tekker, Bank of Montreal, Richard Henshall, Westpac, Masahiro Hosomi, Bank of Tokyo Mitsubishi UFJ, Som-lok Leung, IACPM, Fred Orlan, Barclays, Derek Saunders, HSBC, Kevin Starrett, Citigroup, and Jeffrey J. Weaver, KeyCorp.
The IACPM, with 82 member institutions located in 14 countries, is a professional association dedicated to the advancement of credit portfolio management. Founded in 2001, the organization’s programs of meetings, studies, research and collaboration are designed to increase awareness of the value and function of credit portfolio management among financial markets worldwide, and to discuss and resolve issues of common interest to its members.