(July 27, 2012) — A leading figure in securities lending, who quit the top job at State Street to launch a rival agent, has popped up at independent company eSecLending.
Peter Economou has joined the firm as chief risk officer, eSecLending announced this week. In the newly created position, Economou will be responsible for the oversight and strategic development of enterprise risk management on a global basis, reporting to the firm’s CEOs.
Economou, who had been global head of securities finance at State Street, dramatically quit the bank in June 2010 and took a team of seven to launch a rival firm with former colleague Craig Starble.
State Street immediately began court proceedings against those leaving the bank and the new company was never launched. Several of the former State Street team have since resurfaced in the asset servicing industry.
Karen O’Connor, co-CEO of eSecLending sad: “In recognition of the industry’s advancement and increasing focus on risk management, this new role has been established to ensure eSecLending remains at the forefront of managing risk for our company and our clients.”
This week, clearer guidelines on securities lending practices were unveiled by the European Securities Markets Authority. The new rules demand that all asset managers operating in Europe return any profits generated from their securities lending transactions to the end investors.
Earlier this week, leading economist John Kay called for similar moves from asset managers lending out their securities.