| NEW YORK
NEW YORK Goldman Sachs Group Inc (GS.N) has named Julian Salisbury to become head of its Global Special Situations Group, as current head Jason Brown retires, according to memos sent on Wednesday that were obtained by Reuters.
Salisbury, a partner and managing director who now heads the group's European operation, will move from London to New York for the role.
The Global Special Situations Group is known on Wall Street as one of Goldman's most profitable operations. It invests the bank's own money and sometimes client money in stocks, bonds and loans to distressed companies in hopes of earning profits through a restructuring or turn-around plan.
Although the group is managed by Goldman's securities unit, profits from the business flow into the bank's Investing and Lending earnings segment, which reflects money the bank earns from investing and lending its own capital.
The Global Special Situations Group - often referred to by the acronym SSG - has received more attention in recent years because of the Volcker rule, which prevents banks from trading for their own account and limits banks' investments in hedge funds and private-equity funds.
Although a final Volcker rule has not been released by regulators, Goldman has made some changes to the business to comply with what it expects the rule to say. For instance, it has scaled back short-term bets to make its investments longer-term in nature.
The Global Special Situations Group has been run by a succession of prominent bankers, including co-founder Mark McGoldrick, who left Goldman in 2007 to found Mount Kellett Capital Management with another former executive from the business. McGoldrick left Goldman after receiving a $70 million bonus that he thought was too small, the Wall Street Journal reported at the time.
Brown, who is also a partner and managing director based in Asia, took over leadership of the operation in 2011 when its previous head, Richard Ruzika, retired. Ruzika had been global head of commodities trading and a close friend of Goldman Chief Executive Lloyd Blankfein. He died from a stroke a few months after leaving the bank in May 2012.
In one memo, Isabelle Ealet and Pablo Salame, who are co-heads of Goldman's broader securities business, said Brown had been instrumental in realigning the Global Special Situations Group's investment approach.
Salisbury has been head of the European Special Situations Group and a member of the SSG Global Investment Committee since 2009. Before that he worked in Moscow, expanding business in Russia and the former Soviet Union. He was a founding member of the European division of SSG in 2003 and before that was a distressed debt trader and an accountant at KPMG.
He was named managing director in 2005 and partner in 2008.
A Goldman spokesman confirmed the content of the memos but declined further comment.
(Reporting By Lauren Tara LaCapra; Editing by Gerald E. McCormick and John Wallace)