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Deutsche Bank rates traders live in fear of their great leader leaving

Hopefully, Deutsche Bank paid Alok Modi well last year. Following the disappearance of various members of the European rates trading team, people at the German bank in London are gripped with apprehension that Modi might go too. 

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Modi arrived at Deutsche Bank from Morgan Stanley in 2020 as head of European government bonds, synthetics and cash derivatives in London. To begin, with the rates business which Modi joined had a good time. 2022 in particular was a bumper year for rates desks: DB revenues doubled in the third quarter and rose 400% in the fourth quarter. The European rates team, then run by Josh Hooker, another ex-Morgan Stanley banker, added various new people including Patrick Maber from NatWest and Hemish Shah who joined in 2021 from Morgan Stanley.

Since then, things have looked a bit more shaky. Rates revenues weren't so strong last year. Hooker left for BlueCrest in July 2023, along with Daryl Li, who'd been appointed head of short term interest rate trading (STIRT), Kilian Frensch (head of European swaps to replace Hooker) left for Nomura in October, and so - most recently - did Shah. 

Both Shah and Frensch seem to have been viewed extremely fondly at Deutsche, where former colleagues praise their aptitude and their niceness. "Hemish Shah was a star on the floor," says one. Another describes Shah as a "superstar" who "deserves most of the credit for DB's growth and footprint in the cash business." Another proclaims that Shah was "extremely highly viewed" at Deutsche Bank and that "it came as a complete shock that he was allowed to go."   

Deutsche Bank didn't comment on Shah's exit. Now that he's gone, however, it seems that the German bank's rates traders are fearful that their next favourite person will go too: Alok Modi.

Modi and Shah had worked together for years. Shah was Modi's "trusted sidekick" says one of their DB colleagues. Since at least 2012, the two men had worked at Citi, Barclays, Morgan Stanley, and then Deutsche Bank, with the two typically moving between employers in tandem: Shah joined Barclays on 25th July 2012, for example and Modi joined a couple of weeks earlier; Modi moved to Morgan Stanley in April 2014 and Shah turned up in April.

The question now, therefore, is whether Shah has finally struck out on his own or whether Modi is planning to follow him to Nomura. While this would be a big win for Nomura, it would be a big loss for Deutsche Bank.

The hope is that Modi was one of the various Deutsche Bank people paid well last year and that he will be persuaded to stay. In the meantime, Deutsche has hired a few new people of its own, including Pedro Goldbaum, who recently joined from Citi as head of US rates. Further US rates hires are expected, but London traders would seemingly like more hires there too.

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AUTHORSarah Butcher Global Editor

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