Ex-Credit Suisse MD Jay Kim is having the best time at Apollo
When Jay Kim, Credit Suisse's New York-based former head of fixed income products, left Credit Suisse for Apollo in February 2023, it wasn't the sort of exit to prompt widespread lamentation. Kim, who was hired from Barclays by ex-Credit Suisse head of securitization Brian Chin in 2012, wasn't universally popular at the Swiss bank. Some insiders preferred Jonathan Moore and Mike Dryden, who left in 2022, and whose exits enabled Kim to consolidate his position at CS.
None of that matters now though, because Kim - who moved to Apollo's Atlas SP securitization platform, is thriving.
Speaking at a "deep dive" presentation on Atlas SP this week, Kim said he's surrounded by "people I know and love," with whom he's worked with for 25 years. "We're essentially a finance company that provides financing to finance companies," said Kim, explaining what Atlas does. Mortgage originators are typical clients, he added. "We handle the liquidity and financing of their businesses."
Atlas SP is essentially Credit Suisse's old securitized products group. Kim said it has 270 employees and that "95% of the existing team" from Credit Suisse are there with him, including everyone from first year analysts to managing directors. This is a great thing, said Kim: the team has worked together for years; it's a competitive advantage. Atlas is a, "one-stop shop": it originates, warehouses, structures and distributes. No other asset backed franchise in the market has the same "depth, scale and capability," he elaborated.
Back in the Credit Suisse days, Kim said there were "capital constraints" that hampered the expansion of the business in areas like intellectual property securitization. At Apollo, constraints less of a thing. Atlas is at "right at the core" of Apollo's asset backed credit strategy, said Kim. It has $40bn in assets under management, and since February alone has originated $10bn in new warehouse volume and participated in 73 capital markets transactions.
It sounds like Kim is being paid pretty well for all this. Atlas SP earns 200 basis points of additional yield compared to similarly rated tranches at rival firms, said Kim, without commenting on how much of that is reflected in his team's compensation. The future is bright, he added, pointing to the fact that the market for securitized products was worth $20 trillion in 2022, up from $12 trillion in 2012: "We have uncapped growth potential," Kim declared.
All of this is likely to leave any of Kim's ex-Credit Suisse colleagues who didn't move to Atlas with him feeling a bit deflated. Many of Credit Suisse's fixed income traders are among the thousands of staff let go by UBS. Some have found new jobs at Deutsche Bank; others are on the street and might be wishing they'd shown Kim more appreciation while they had the chance.
There is one cloud on Kim's horizon. UBS has decided that it won't be paying Atlas generous fees to manage securitized assets on Credit Suisse's balance sheet after all, and it took a $600m writedown relating to this decision in its most results. Kim made no mention of that, however.
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