Erin Callan, former Lehman Brothers chief financial officer, has been hired by Credit Suisse to fill the new position of global head of its hedge fund business, the company said on Tuesday, FT.com reports.
A rising star at Lehman, Callan was removed as chief financial officer after just a few months following the banks embarrassing $2.8 billion second quarter loss and questions about its strategy of engaging with David Einhorn, a prominent hedge fund manager and Lehman critic.
Callan, who spent 13 years at Lehman, remains respected within the hedge fund world, where she helped advise on the initial public offering of Fortress Investment Group, among other transactions.
Prior to becoming CFO, Callan headed an investment banking unit at Lehman focusing on alternative asset managers. She was a protg of Joe Gregory, who was removed as Lehman president in the wake of the losses but is still with the bank.
In an interview, Paul Calello, chief executive of Credit Suisses investment bank, said he was creating the new post to focus on an increasingly important client base both in prime brokerage and strategic advisory services.
Hedge funds are among the biggest fee payers on Wall Street. Big universal banks such as Credit Suisse and Deutsche Bank have been making strong plays for hedge fund business in the wake of the Bear Stearns collapse, arguing their balance-sheet heft lends them more solidity in times of market stress.
Despite her rough exit from Lehman, Calello says Callan has a proven track record. She is extremely professional, exceptionally intelligent and we are very fortunate to have the opportunity to have her join us. He says Callan will advise hedge fund clients on fundraising, listings, strategic stake sales and other transactions.
The appetite for hedge fund IPOs has cooled since Fortress went public early last year. Its shares now trade at around half their $18.50 offering price. However, several large groups are thought to be considering IPOs once market sentiment improves.
Callan, a lawyer before joining Lehman, stayed on briefly after her removal as CFO but was widely expected to seek another opportunity. She begins her new job on September 2 and will join the management committee of Credit Suisses investment bank and the global client steering committee.
“This gives me the opportunity to return to my roots covering the hedge fund community,” says Callan in a statement.