The head of a key European structured finance division at Barclays Capital has quit this week, sources familiar with the matter said, as market turmoil battered the investment structures that his team helped arrange.
Edward Cahill, who had led the European collateralised debt obligations (CDO) division, left on Monday after returning from holiday, the sources said, confirming reports on Friday.
Demand for CDOs, portfolios of debt securities divided and sold in pieces based on their relative exposure to default risk, has boomed as investors have demanded high yields. But recent turmoil in the market for US subprime mortgages, many of them packaged into CDOs to make them attractive to investors, has focussed regulatory and market concern onto the structures.