Achintya Mangla returns to J.P. Morgan

Convertible bond specialist Achintya Mangla, who resigned from J.P. Morgan and signed a contract to join Bank of America Merrill Lynch earlier this month, has had a change of heart and will be returning to his old firm. The surprising move comes after a restructuring of the equity capital and derivatives markets (ECDM) team at J.P. Morgan, which made room for a bigger role for Mangla.

According to an internal announcement at J.P. Morgan, Mangla will assume a role as joint head of ECDM for Asia ex-Japan together with Arjun Khullar who moves up a step from his previous job as head of South and Southeast Asia  ECDM.

Aloke Gupte, who was going to accompany Mangla to BoA Merrill, will also return to J.P. Morgan and will take up Mangla's old job as head of equity-linked origination for Asia-Pacific, a role that includes coverage of both Japan and Australia.

To make room for this, Kester Ng, who until now has been head of ECDM for Asia ex-Japan, has been appointed joint head of ECDM for the entire Asia-Pacific region, including both Japan and Australia. He will share this job with Doug Howland, who was previously head of ECDM for Japan.

Mangla and Khullar will report to Ng and Howland, as will David Gray who remains head of ECDM for Australia.

In the statement, J.P. Morgan explained the reshuffling by saying it wants to capitalise on the success it has achieved within ECDM both globally and in Asia-Pacific and "generate the focus and intensity needed to drive the business to the next level".

Ng joined J.P. Morgan from Merrill Lynch in 2006 as co-head of ECM for Asia ex-Japan and took over sole responsibility for the team in March 2007 when Jonathan Back moved to a transitional role before leaving the bank later that year.

Also in March 2007, Khullar transferred from J.P. Morgan Cazenove in London to become head of Southeast Asia ECM. At that point, Khullar had been with JPMorgan Cazenove and its predecessor firms in London for 12 years. Before that he was with Jardine Fleming in Asia.

On paper, the restructuring suggests that Ng's expanded role will allow him to focus less on the day-to-day running of the equity capital markets business and more on strategic issues such as the integration of the ECDM teams across the region. However, Mangla, who is 34, is a largely untested card outside the convertible bond space and it is fair to assume that Ng will continue to play a role, especially with regard to the China coverage. While more experienced, Khullar's focus so far has been primarily on Southeast Asia and India.

It seems the opportunity to get a bigger role and experience outside the CB industry was what drove Mangla to leave J.P. Morgan in the first place. At BoA Merrill he was to become head of Southeast Asia ECM as well as head of equity-linked solutions for Asia-Pacific ex-Japan. According to sources, he was clearly hired for his CB qualifications, however, and BoA Merrill wasn't prepared to match the broader Asia ex-Japan role Mangla is now getting at J.P. Morgan.

Sources at J.P. Morgan said yesterday that Mangla's return to J.P. Morgan was more about this step-up in terms of product and geographical coverage than about money. Indeed, they stressed that the firm is not matching the package he was set to get at BoA Merrill.

Meanwhile, sources at BoA Merrill said Mangla was an incremental hire that was not intended to fill a gap. The bank is committed to increase its equity-linked flow business alongside the highly structured and privately placed equity-linked transactions that have been its main focus in recent years, but it doesn't have to hire new people to make that happen, they said.

Either way though, Mangla's decision to go back to J.P. Morgan highlights what seems to be an increasing lack of commitment in the investment banking industry following the financial crisis. While resigning before even starting, as in the case of Mangla and Gupte, is not common practice, the frequency with which many bankers are willing to switch firms seems to be picking up.

It is, of course, inevitable that banks will poach talent in rising markets in order to match increasing workloads and that bankers will take the chance to make some more money and get a bigger title when the opportunity presents. But it is questionable whether the industry is really helped by bankers switching firms several times in just a few years -- certainly it is contributing to pushing bonus levels and guarantee packages ever higher at a time when regulators are arguing for more restrictive remunerations. In the longer run, should this continue, it will be interesting to see what impact it may have on client relationships.

The restructuring at J.P. Morgan is also testament to exactly how keen the bank is to keep Mangla and Gupte. Mangla had been head of the equity-linked team at J.P. Morgan since 2003 and, during the more than eight years that he spent with the firm in Hong Kong, he helped build the bank into one of the powerhouses within CB origination in the region.

Gupte has been a member of the equity-linked capital markets team in Hong Kong for the past two to three years after transferring from India. He joined J.P. Morgan in India five years ago, having started his career in investment banking at HSBC.