LONDON/NEW YORK (Reuters) - JP Morgan’s (JPM.N) metals trading chief Peter Sellars, one of the last senior Sempra-era executives to remain at the bank, will retire in January, according to a memo sent to staff on Monday.
Sellars, who turns 60 in January, will be succeeded by New York-based Mike Camacho, who has been running the sales and investor products business, and global agriculture, according to the memo. Camacho has been at the bank for 20 years, and ran metals for several years prior to the RBS Sempra deal.
A 35-year industry veteran who began his career at U.S. metals and chemicals firm Engelhard Industries, Sellars had postponed his retirement once to oversee the spin-off of the RBS trading unit in 2009, and again to manage its integration with JP Morgan since last summer.
“We’ve got a very strong management team — now it needs somebody like Mike...to take it forward,” Sellars told Reuters by phone. “The business is going through a lot of changes with new regulations, the move toward electronic trading — we need that new vision for the next five years.”
A number of former RBS Sempra traders left the firm last year as JP Morgan closed on its $1.6 billion deal to buy the RBS Sempra global metals and oil business, combining the bank’s strong precious metals dealing operation with a renowned London Metals Exchange and physical base metals team.
The departures coupled with some high-profile trading losses initially spurred questions about commodities chief Blythe Masters’ leadership.
But the bank seems to have found a firmer footing this year. While Morgan Stanley (MS.N) and Goldman Sachs (GS.N) both reported a “significant” drop in second quarter commodities earnings, JP Morgan made no negative mention of the division, and media reports this summer suggested it was running well ahead of its full-year target.
“For J.P. Morgan, Peter has presided over the creation of an extraordinarily powerful global business that is unrivalled in the scope and capabilities we offer clients,” according to the memo, a copy of which was seen by Reuters.
“Our metals platform undoubtedly will continue to benefit from the momentum he created.”
Sellars joined Sempra Metals in 2002 as the chief executive of Henry Bath & Son, the global warehousing operation that has long been a money-spinner. He became CEO of the metals trading subsidiary in 2006, taking charge of a team that traced its roots back to legendary trading firm Metallgesellschaft.
He worked at Barclays Capital from 1992 to 2000.
After swallowing RBS Sempra and the commodities arm of Bear Stearns during the financial crisis and making a series of high-profile hires, JP Morgan bulked itself up to compete with top commodities banks Goldman Sachs and Morgan Stanley.
But many of the traders at Sempra who had already chaffed at the original joint-venture with RBS did not stick around.
Sempra’s founding fathers, David Messer and Frank Gallipoli, left a year before the JP Morgan deal to set up a new trading shop. Michael Hutchinson, a famed senior metals trader, left to join the management team at commodity trade house Armajaro several months before the deal was completed.
Other renowned metals traders have departed more recently. Star prop trader Tim Jones joined London-based hedge fund RK Capital in May after the Volcker Rule forced most U.S. banks to shut down their proprietary trading divisions. Senior trader Richard Toller retired earlier this year.
At the same time, the bank has reshaped the metals division to focus on customer business, combining its solid credit rating with a broad trading operation that runs from physical metals and storage through derivatives and project finance.
Its approach to financing has also won over customers at a time when many large European banks have struggled with rising funding costs. Because of its infrastructure, the bank can lend to customers against inventory such as a truckful of copper pipes, traders said.
JPMorgan trimmed its commodities trading risk in the third quarter while upping its risk in currencies and bonds, as heightened volatility across markets reduced the attractiveness of riskier assets like raw materials.
JPMorgan Chase & Co reported lower third-quarter profits, including a decline in quarterly revenues in its Fixed Income Markets business, which includes commodities.
Reporting by Melanie Burton; editing by James Jukwey and David Gregorio