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Goldman Sachs Group
Inc.
GS 0.89%
is shaking up its leadership in Asia, where a highly publicized corruption scandal has had the effect of slowing down the negotiation process.
Andrea Vella and Kate Richdale, head of investment banking at Goldman in the region, are stepping down, according to people close to the case. They will be replaced by Todd Leland, an adviser to European banks and asset managers, who was asked last year to help manage Goldman's operations in Asia.
The changes of direction were fast under David Solomon, who took on October 1 the functions of general director of Goldman. The company has appointed a new president, replaced its chief financial officer, appointed two new leaders to head its trading activities, and begun to change the way it covers key customers.
Mr. Vella, a banker born in Italy, has recently been involved in two dark looks for the investment bank of Goldman. He structured a Malaysian bond offer that took Goldman to the trap of an extensive corruption investigation that could result in a hefty financial penalty. He also worked on a derivative sold to the Libyan sovereign fund that ended in the courts last year. (The company was acquitted of any wrongdoing and the trial, in which Mr. Vella testified, made unflattering details of the company's relationship with the fund public.)
Ms. Richdale joined Goldman in 2013 as a highly touted Morgan Stanley recruit. Born in Hong Kong and fluent in Mandarin, she has established relationships with local giants, including Singaporean investment fund Temasek Holdings Pte. Ltd.
She will move to a position that involves more face-to-face time with clients, said people familiar with the case, giving up daily supervision of the company as Goldman tries to place more women in leadership roles.
Asia has been a difficult region for Wall Street businesses, despite the rapid growth of its economies. Sales charges are lower than those in the United States and tend to be spread among a larger group of banks. The merger activities are very hot and cold, with strong influence from government officials. In 2016, Goldman laid off dozens of bankers in Asia due to the slowdown in trading volume.
Asia is the smallest and least profitable of the three geographic divisions of Goldman. The main investments that had once increased returns – Goldman's participation in
Industrial and Commercial Bank of China
Ltd.
profitable enough to earn his own position in the company's financial reporting for years – have for the most part been removed.
In the first half of 2018, Goldman had pre-tax earnings of $ 767 million in Asia, Australia and New Zealand, representing approximately 11% of the total. Asia contributes little to the overall benefits of most Western banks in the region.
Goldman is ranked No. 1 this year in stock subscription and M & A in the region, excluding Japan, according to Dealogic. He helped lead the smartphone manufacturer's Chinese IPOs
Xiaomi
Corp.
and online service platform
Meituan Dianping
,
and is a major underwriter of the upcoming Tencent Music Group Entertainment listing in New York.
Mr. Leland, a Midwest member who worked for Goldman in the United States and London, is considered an experienced banker.
A little further up the hierarchy, Raghav Maliah, head of Asia's technology bank for Goldman; Aaron Arth, who leads the equity markets; and Iain Drayton, who covers private equity funds and sovereign wealth funds in the region, according to people familiar with the subject.
Write to Julie Steinberg at [email protected] and Liz Hoffman at [email protected]
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