Erin Callan, the former CFO of Lehman Brothers who was demoted last month, has left the bank to join Credit Suisse, the latter firm said Tuesday.
Callan will be a managing director and run Credit Suisse’s hedge- fund business from New York. Before becoming Lehman’s finance chief in December 2007 she was head of hedge-fund activity at the bank, where she worked for 13 years. In June she returned to its investment banking division.
“I’m excited to be joining Credit Suisse and look forward to working with their talented people,” Callan said. “This gives me the opportunity to return to my roots covering the hedge fund community, which is playing such a critical role on the Street.”
Lehman has struggled recently and Callan was under pressure after the bank suffered a $2.8 billion loss in the second quarter of this year. In spite of the setback, she waged a forceful campaign for transparency. Just a month before her demotion a glowing story about her in the Wall Street Journal on May 17 called her “a galvanizing force at Lehman and a finance chief who topples much of the conventional wisdom about CFOs.” The Journal described the 42-year-old as the highest-ranking woman on Wall Street.
Callan’s star may have been tainted by a recent public sparring match with hedge-fund activist David Einhorn. She fended off criticism by Einhorn, founder of Greenlight Capital. He occupies a short position on Lehman’s stock and recently morphed from a reclusive hedge fund manager to a media-savvy specialist. He challenged Callan to be more forthright about the investment-banking giant’s balance-sheet risks and how the firm values its assets.
Credit Suisse may have been interested in Callan for a while. In February she delivered a talk at the Credit Suisse Financial Services Forum in Florida where she discussed Lehman’s performance.
“Erin will strengthen our position with our hedge fund clients, who continue to be an increasingly important client base,” said Paul Calello, CEO of Credit Suisse’s Investment Bank. “We and our hedge fund clients will benefit from Erin’s talents and experience.”
Lehman replaced Callan with Ian Lowitt, formerly co-chief administrative office at the investment bank. He was Lehman’s executive vice president and co-chief administrative officer since October 2006. In that role he has been responsible for the global oversight of corporate real estate, expense and sourcing services, finance, operations, productivity and process improvement, risk management, and technology.
While at Lehman Callan was successful bringing hedge funds such as the Fortress Investment Group and Blackstone Group public. Credit Suisse anticipates that she will help them grow their hedge fund business to compete with Goldman Sachs and Morgan Stanley, the prime brokerage leaders.