- Morgan Stanley has poached a top distressed-debt trader from Deutsche Bank.
- Matthew Weinstein has resigned from the German lender and is joining Morgan Stanley as the head of North American distressed trading, according to people familiar with the matter.
- Deutsche Bank, despite its high-profile struggles, is one of the top credit-trading firms on Wall Street, and is a standout in distressed debt.
- Distressed credit trading is primed for renewed activity and importance as a trillions of corporate debt comes under pressure from the economic fallout of the coronavirus pandemic.
- Visit Business Insider’s homepage for more stories.
Morgan Stanley has a hired a top trader from Deutsche Bank’s distressed-debt operation, a bread-and-butter businesses for the German lender that will gain renewed importance amid the economic fallout from the coronavirus.
Matthew Weinstein has resigned as the US head of distressed trading at Deutsche Bank, according to people familiar with the matter. After gardening leave, he’ll join Morgan Stanley as a managing director and head of North American distressed trading, the people said.
Weinstein spent more than a decade with Deutsche Bank, according to FINRA records. That followed tours at Bear Stearns and Weil, Gotshal, and Manges, according to his Bloomberg bio.
Representatives for Morgan Stanley and Deutsche Bank declined to comment.
While Deutsche Bank has grappled with controversy and financial upheaval in recent years — including jettisoning its equities trading business last summer — credit trading is one of the firm’s bright spots. It tied with JPMorgan Chase for first place in credit-trading revenues in 2018, the most recent league table available from Coalition, and is home to one of the top distressed-debt houses on Wall Street.
Morgan Stanley, by comparison, is one of the premier equities-trading firms, but it doesn’t crack the top-5 in credit trading.
Distressed credit trading is primed for renewed activity and importance as a trillions of corporate debt comes under pressure from coronavirus pandemic. Since the last financial collapse, corporate America binged on credit, amassing $10 trillion in debt, thanks in part to low interest rates as well as lax covenants and standards.
Large swaths of the debt markets are being reevaluated and credit ratings are getting slashed amid the unprecedented economic turmoil from the Covid-19 outbreak, which has crippled business activity for many regions and industries.
Moody’s on Monday cut its outlook on corporate debt to negative. Credit strategists at UBS said last week that more than $1 trillion in corporate debt may be distressed.
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