With only weeks to go until the end of the year, Morgan Stanley has lost one of the biggest producers in its macro trading business. The exit has the potential to cause ructions in the coming bonus round.
Mitchell Nadel left last week. Bloomberg reported on the departure, saying that the reason for the exit was unclear. Nadel's name was previously mentioned in association with losses of around $140m relating to the mis-marking Turkish lira securities by an associate in London. When reporting Nadel's exit, however, Bloomberg said that he was neither suspected of being involved in mis-marking the trades or of concealing the losses and that he had a 'minimal' role in the business in question. Morgan Stanley declined to comment further.
Nadel was a steady pair of hands for the U.S. rates business which has caused problems for Morgan Stanley in the past. He was promoted as co-head of global rates together with Jakob Horder in 2014, after the previous head Glenn Hadden was reported 'asked to leave' in the wake of losses exceeding $200m. Nadel was then subsequently made head of U.S. macro trading in 2016 while Horder was made head of European fixed income and commodities.
Following this year's loss, Horder was made global head of macro trading in August. And now that Nadel is no longer with Morgan Stanley, David Flowerdew - the previous head of rates - has been made the head of U.S. macro.
The changes represent a significant change in previously stable team just as the bonus pool is finalized. Morgan Stanley doesn't comment on bonuses, but members of Nadel's team will be hoping that this year's losses and the exit of their former boss won't impact their pay. That may yet prove wishful thinking.
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