Primus lures in Swiss Re’s Schaumann plus other key staff

Hilmar Schaumann, a senior credit derivatives trader for Swiss Re in New York, has quit the firm to join Primus Financial Products, a wholesale provider of credit risk protection.

Swiss Re incorporated its credit derivatives and cash trading businesses within its Financial Products arm last August following a restructuring of its business lines. The unit is now jointly run by Bill Kramer, a senior vice-president based in New York – Schaumann’s old boss – and Kazik Swiderski, managing director for credit trading, in London.

It is unclear if Swiss Re plans to replace Schaumann. A spokesperson for Swiss Re declined to comment specifically on this matter. But it is anticipated that Gordon Boozer, an active credit derivatives trader at Swiss Re, may replace Schaumann on the International Swaps and Derivatives Association’s credit derivatives market practices committee.

Primus began its latest business incarnation in March this year after it raised $155 million in equity capital from XL Capital, Radian, CalPERS/PCG Corporate Partners and Aegon. An earlier attempt to launch the company as a technology start-up under the name Eprimus was put on hold due to fund-raising problems.

Triple-A rated Primus claims it is the industry’s first wholesale provider of credit risk protection to derivatives dealers and credit portfolio managers. Customers will buy protection on more than 1,200 individual, investment-grade entities. The company intends to hold and manage the risks in its portfolio – effectively functioning as an investor in single-name investment grade corporate and sovereign financial obligations.

Tom Jasper, Primus chief executive, told RiskNews the delayed launch was due to difficulties raising capital. The company pulled back plans to launch Eprimus as a public company, and restructured it as a Bermuda holding company. “This provided us with a better platform than the e-commerce platform,” said Jasper.

Credit derivatives dealers in New York believe Primus now has a good chance of success.

Jasper said Primus is expanding its headcount before going live later this month. The company also hired Zachary Snow – previously executive vice-president, general counsel and co-chief executive of financial information company Bridge Information Services – as general counsel. Other new additions are Thomas Gavenda, formerly chief financial officer of Deutsche Banc Alex. Brown, who joined Primus as controller; while John Kerr and Vincent Abruzzini both join Primus as credit risk officers. Before joining Primus, Kerr was a managing director and senior-vice president for credit risk at Bank of America; Abruzzini was a vice-president in specialised industries credit risk management at Summit Bancorp.