Bear Stearns re-hires mortgage trader Middleton
NEW YORK, Dec 19 (Reuters) - Bear Stearns Cos. Inc BSC.N rehired Russell Middleton as a trader on its mortgage-backed securities desk, a company spokeswoman said on Wednesday.
Middleton, who left Bear Stearns in 2005, was fired from HSBC Holdings' (HSBA.L) last month as the U.K. bank closed the mortgage bond desk at its U.S. securities unit.
Known across Wall Street for his dry wit and charity fund raisers, Middleton trades mortgage-backed securities issued by government-sponsored enterprises Fannie Mae and Freddie Mac, and government-owned Ginnie Mae. The $4 trillion "agency MBS" market has been relatively immune from the credit crisis in subprime debt and mortgage bonds from other issuers since payments are guaranteed to investors.
With financing for "non-agency" debt now too costly to justify, U.S. lenders are steering production toward loans eligible for agency MBS. Market share for Fannie Mae, Freddie Mac and Ginnie Mae securities has climbed above 80 percent this quarter, almost double that of 2005 when Wall Street banks were able to raise cheaper money from private investors, according to UBS research.
The hire comes as Bear Stearns and other Wall Street firms have been slashing jobs amid heavy losses in subprime mortgages and other structured debt securities. Since mid-August, Bear Stearns has announced the elimination of about 1,490 jobs. (Reporting by Al Yoon; Editing by Diane Craft)
