Jacob Morton, a veteran sales trader in the sell-side community, has joined Mendon Capital Advisors Corp as the firm continues to expand.
Anton Schutz, president and chief investment officer at Mendon Capital, noted that his firm, in partnership with RMB Asset Management, recently launched a global long/short financial services fund in February. The addition of the product required the company to add depth and allocate trading time outside of U.S. hours. Morton allows the firm to do that, deepens its bench and brings considerable experience, Schutz said.
"It was just an ideal time to hire Jake," Schutz said in an interview. "I think he's one of the best traders on either side of the Street. He's just top tier."
Morton comes to Mendon Capital from Piper Jaffray Cos., where he served as a sales trader in the firm's financial services group. Prior to that, he worked at Sterne Agee & Leach Inc. and Moors & Cabot. Before joining Moors & Cabot, Morton worked with Schutz in the early part of the 2000s.
Morton joins two other traders at the firm. His hiring comes a few months after Mendon Capital hired Reed Deupree, who previously served as a portfolio manager at GMT Capital and as a vice president in the global financial services fund at Carlyle Group, to serve as portfolio manager of the new global fund. Deupree joins Russell Echlov, senior portfolio of the global financials fund and portfolio manager of the U.S. fund. In 2017, Mendon Capital hired T. Sadler Stukes Jr., a former managing director at Sandler O'Neill, as a senior adviser and portfolio strategist to aid in its U.S. bank effort.
"We're really excited about the opportunity. We're excited about getting people the caliber of Reed and Jake," Schutz said.
Schutz said the global fund will have some exposure to U.S. banks, allowing the firm to take advantage of its experience in the sector. But he noted that the U.S. is home to only one-quarter of the publicly traded financials in the world and he sees investment opportunities emerging abroad. For instance, he said there is potential for negative interest rates to move into positive territory and that move would follow rebounding economic growth. He noted that the operating environment in some areas abroad is similar to what was seen in the U.S. in 2010 and 2011, when clearing prices on distressed assets began to emerge. He added that valuations appear compelling.
In the U.S., Schutz still sees the opportunity to invest in strong deposit franchises that are increasingly becoming worth more to would-be acquirers. As banks continue to report increases in their loan-to-deposit ratios, funding will become a more important part of any deal discussion.
"It's just causing problems for the guys without the deposit franchises," Schutz said. "You have guys who have deposits that are going to be able to do it and guys that don't are going to have to get it or they'll have to sell."
