11/12/2010

Brokerage Duo Reawakening Dormant Shop

Two bond brokers are re-forming a short-lived firm they disbanded to join NewOak Capital.

James Colonias and Ron Yung, who led a capital-markets division that NewOak shuttered a month ago, launched the new incarnation of their Vesper Capital in the past few weeks. They're now interviewing prospective employees, with the intent of hiring 6-10 sales professionals, traders and analysts for the Maplewood, N.J., operation over the next 4-6 months. The prospective recruits include what the firm describes as a high-ranking collateralized debt obligation specialist.

Once fully up and running, Vesper would trade mortgage bonds, commercial mortgages, CDOs and unusual asset-backed securities like those underpinned by insurance-related cashflows. The shop also offers advisory services. For instance, it's helping an undisclosed bank restructure and recapitalize. A bond-valuation component is under consideration as well.

Vesper has struck an agreement to clear its bond trades through Atlanta brokerage IFS Equity, while arranging to use a separate firm's computer systems to trade commercial mortgages.

The original version of Vesper, based in Morristown, N.J., shut down when Colonias and Yung moved to NewOak in January with colleagues Tom Caton, Ervin Pilku, Sean Smith and Bruce Strengberg. They became the core of NewOak's capital-markets area.

Around midyear, however, Colonias and Yung began a process that saw them break off from NewOak while continuing to function as an affiliate of the firm. The apparent plan was to create some type of satellite operation. But talks eventually broke down, leading the two sides to sever ties in mid-October.

Colonias and Yung are using their own money to recreate Vesper, but may bring in additional stakeholders. Yung was in Asia this week, talking to potential backers and clients.

Colonias founded Vesper in March 2009, following a stint as a trader at Fieldstone Capital. Previous stops included Hillard Farber, Burlington Capital and Tullet Prebon. Yung worked at Cremac Asset Management, CGA Investment, Sumitomo Bank and Morgan Stanley.

Caton, Pilku, Smith and Strengberg also have split off from NewOak, but didn't follow Colonias and Jung back to Vesper. Pilku has joined Advisors Asset Management, while Smith signed on with Auriga Securities (see The Grapevine on Page 1). As for Vesper's staffing efforts, it's possible that the firm will hire an entire team from another shop. However, it plans to take a measured approach dictated by its business volume.

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