Philip Vasan • Managing Director • Head of Prime Services and Capital Services • Credit Suisse • New York •
“Transformation” best describes how the securities services landscape has been rocked in the last year and a half. The board may be the same, but the pieces have moved. Some are gone, others just arriving.
It’s not the change itself that has surprised Philip Vasan-who had been forecasting it for years-but how rapidly the market has absorbed it. From the shifts in the prime brokerage market microstructure to the testing of hedge funds’ resilience in the face of upheaval, the pace of the new realities arriving has been swift.
“We expected this to play out by 2012, not 2010,” says Vasan, head of prime and capital services at Credit Suisse. “The market-wide premium on safety in addition to quality has accelerated the move.”
Vasan has brought a fresh perspective to prime brokerage that reflects his breadth of front-to-back experience since joining Credit Suisse in 1992. He developed the firm’s foreign exchange derivatives business, ran global foreign exchange, ran global equity derivatives and convertibles and also led Credit Suisse’s e-commerce investments and cost-reduction efforts. He expects more players to move their pieces onto the prime brokerage board soon. In addition to the current largest five, “We expect a few firms getting back on their feet to declare renewed interest in this market, and execute their game plans over the next couple of years.”
But he believes that hedge funds, driven by their investors, will continue to look for the firms holding the strongest hand and vision.
“We’ve crafted our strategy for years around a more evolved future hedge fund market, with far fewer funds, with investors being much more influential, and with the ultimate winners being able to deliver less-correlated returns on an institutional quality platform,” he says. “I see that as the Holy Grail for hedge funds.”