Goldman poaches senior Citi sales staff

Citi loses Shantanu Shete and Vishweshwar Anantharam to Goldman Sachs despite expectations of imminent salary increases.

Two senior Citibankers have jumped ship to Goldman Sachs, choosing assured payouts at the Wall Street investment bank over forthcoming salary hikes at Citi.

Shantanu Shete, who was head of hedge fund sales at Citi covering credit, will join Goldman Sachs as a managing director. And Vishweshwar (Vishy) Anantharam, director and head of Citi's Asia global macro sales, who covered rates and foreign exchange, is moving to Goldman as a vice-president. Their precise job descriptions and joining dates have not been finalised, said sources.

Both will report to Vinit Sahni, head of fixed income, currencies and commodities distribution for Goldman Sachs. The US investment bank hired Sahni in 2007 from Deutsche Bank in London, where he was European head of rates sales, to head foreign exchange, interest rates and macro product sales for Asia.

At Goldman, Shete and Anantharam will both be based in Hong Kong. Goldman Sachs had no comment on the move.

"We continue to see strong flows across our hedge fund business in Asia-Pacific and we will be adding to the team in the coming weeks," said a Citi spokesperson commenting on the departures. No replacement has been announced for either position yet. Citi has a team of around 50 professionals covering hedge funds across Asia-Pacific.

Goldman Sachs is among 10 US banks which have repaid the bailout capital they received from the US Treasury as part of the Troubled Asset Relief Program (Tarp) last year after the collapse of Lehman Brothers. Citi has not yet repaid its Tarp money, which comes with certain terms and conditions, including limits on the level of executive compensation the bank can pay as long as it is a Tarp recipient.

"Goldman Sachs is one of a few firms that are currently offering guaranteed payouts and this, combined with the strength of the franchise, is helping it attract top-notch talent," said a source.

Shete and Anantharam leave on the eve of expected salary revisions at Citi, according to sources. The US bank is rumoured to be announcing an increase in salaries next week, following a similar move by fellow US firm Morgan Stanley.

On May 22, Morgan Stanley advised the New York Stock Exchange it will increase base salaries as part of efforts "to move away from a compensation programme focused largely on annual incentive awards toward one that is balanced between fixed, short-term and long-term compensation". (A detailed story on changed compensation practices at Morgan Stanley was published on our website on April 9.)

The investment bank clarified that the salary revision was not intended to increase overall salary packages, but rather would adjust the mix between fixed compensation and bonuses. And this is the expectation at Citi as well, although it is worth noting that there is a net present value benefit to having part of the bonus added to the monthly salary.

Morgan Stanley said in its NYSE filing that the "adjustments also are designed to raise base salary levels that were below several of [its] peer companies" although the US investment bank did not clarify which peer group it benchmarked itself against. Some sources said benchmarking was largely against Goldman Sachs.

As part of the salary revisions announced last month, Morgan Stanley left the salary of its chairman and chief executive officer, John Mack, unchanged at $800,000. However, it revised, effective May 1, to $800,000 the salary of co-president James Gorman. Co-president Walid A. Chammah will receive a revised base salary of £525,000, which the bank clarified is also intended to be approximately $800,000; chief financial officer Colm Kelleher will receive £490,000, or approximately $750,000; and chief legal officer and vice-chairman Gary Lynch and chief administrative officer Thomas Nides will each receive $750,000.

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