J.P. Morgan Dallas Star Steve Smith Leaves After 49-Year Career
Stephen B. Smith, one of J.P. Morgan Securities’ most successful brokers who joined predecessor Bear, Stearns Securities in 2001, has left the company to set up his own investment fund, the firm told its brokerage salesforce on Thursday.
Smith, 74, is based in Dallas and has specialized in a levered bond strategy that buys short-term Treasuries on margin and trades longer-term instruments in an attempt to capture the spread, said a person familiar with his practice. In some years, the strategy generated revenue of as much as $20 million but as the yield curve has flattened the trades have become riskier, said a person familiar with his practice.
“Steve Smith, an outstanding financial advisor in our Dallas office for the past 17 years, has told me he is leaving the firm to pursue a new opportunity,” J.P. Morgan Securities President Chris Harvey wrote in an email to brokers on Thursday. “Steve has been critical to our success in the Dallas office and nationally. He truly embodies the entrepreneurial spirit of J.P. Morgan Securities and we wish him the best in his new venture.”
The broker, who began his trading career in 1969 with Smith Barney, is setting up an independent firm that “will focus in large part on the successful fixed-income strategy he has managed for over 35 years,” Harvey wrote in the memo.
Smith is affiliating with Greenwich Prime Trading Group, which he plans to rename Smith Capital Markets, the memo said.
Greenwich is a 17-year-old Connecticut-based prime broker for institutions and funds. Eric Savitz, the son of Greenwich founder Barry Savitz, said that he, his father and the two other managing partners listed on the firm’s website are no longer affiliated with Greenwich. Smith’s BrokerCheck record, which has no disclosures of customer or other incidents throughout his 49-year career, says he registered with Greenwich Prime on July 17.
When Smith joined Bear Stearns in 2001 after six years at Lehman Brothers and 18 years at Credit Suisse First Boston, he was managing more than $2.6 billion for wealthy individuals and families, according to a Bear Stearns press release.
“I try to help my clients manage their financial assets through a comprehensive approach including advisory services, execution and creative financial engineering,” he said at the time.
Smith did not return calls for comment to two home numbers. His son and son-in-law, Thad Smith and Adam Koch, who remain at J.P. Morgan Securities, did not return calls for comment.
In 2003, Smith donated $2 million to Davidson College to support his alma mater’s football program. A running and defensive back at the school during his undergraduate years, he has served on Davidson’s board and has an athletic field named in his honor there.
Smith, who also has an MBA from Stanford University, has owned a charter aircraft company since 2014 and is on the investment committee of Texas Health Resources, which operates 25 hospitals in north Texas, according to his most recent investment advisor registration filing with the Securities and Exchange Commision. He registered a new company called Quahadi Holdings in April in Texas.
J.P. Morgan Securities employs about 25 advisors at its Dallas brokerage office at Crescent Court, including five who joined late last year from Morgan Stanley and UBS as those firms were preparing to leave the Protocol for Broker Recruiting.