fw : commodity structuring and year end prc fyi - - i have not heard back from john on this yet . in light of current events , i do not expect to soon . i will let you know when i hear from him .
ed
- - - - - original message - - - - -
from : mcmichael jr . , ed
sent : wednesday , october 24 , 2001 3 : 42 pm
to : lavorato , john
subject : commodity structuring and year end prc
john ,
i mentioned that i wanted to discuss the year - end prc process as related to commodity structuring when i met with you in early september . you said that the whole prc process was being discussed / reviewed and that i should wait until november to discuss it with you . i had intended to contact you next week to have the follow - up discussion , but frank vickers mentioned last week that the same ( or a closely related ) issue was recently discussed in one of your staff meetings and recommended that i share my thoughts with you now . i do not know exactly what was discussed at your meeting , but the questions i want to discuss are as follows :
1 . is commodity structuring properly placed on the " commercial " table ?
2 . if so , how does commodity structuring get equitable rankings and equitable compensation ?
3 . if not , what table should commodity structuring be on and how should they be compensated ?
i believe that the people in my group are " commercial " because the organization expects them to do the following :
understand and structure any commodity transaction
see the " big picture , " as well as the detail
accurately and completely identify and cost / value all parts ( risks and opportunities ) in commodity transactions
develop and propose alternate deal structures
customer interface ( with and without originators ) to field technical questions , negotiate technical issues and / or conduct due diligence
review contracts , draft language , recommend changes and insure risk coverage therein
collaborate with research group to develop new models to price / value non - standard product offerings
represent the desks in risk mitigation while negotiating with the desks to get fair / reasonable quotes
make sure all the bases have been covered on a deal and that the deal value ( including desk reserves , cof , credit , legal , etc . ) matches the booking / unwind .
in essence , everything that an originator should do , except considerably more technical in nature , but without primary customer relationships , deal identification responsibilities and specific profit goals . i recognize that the exceptions are very important distinctions and do not want to infer that the roles are the same . in fact , maybe it is the exceptions that determine the distinction . however , commodity structuring , maybe more that any other single group , is hiring , training and developing individuals that regularly transition into " true " commercial seats ( origination and training ) at the request of the leaders of those groups .
i would like to fully discuss and get resolution before the prc process gets underway . can we meet soon ? please advise .
regards ,
ed
fw : commodity structuring and year end prc
fyi - - i have not heard back from john on this yet . in light of current events , i do not expect to soon . i will let you know when i hear from him .
ed
- - - - - original message - - - - -
from : mcmichael jr . , ed
sent : wednesday , october 24 , 2001 3 : 42 pm
to : lavorato , john
subject : commodity structuring and year end prc
john ,
i mentioned that i wanted to discuss the year - end prc process as related to commodity structuring when i met with you in early september . you said that the whole prc process was being discussed / reviewed and that i should wait until november to discuss it with you . i had intended to contact you next week to have the follow - up discussion , but frank vickers mentioned last week that the same ( or a closely related ) issue was recently discussed in one of your staff meetings and recommended that i share my thoughts with you now . i do not know exactly what was discussed at your meeting , but the questions i want to discuss are as follows :
1 . is commodity structuring properly placed on the " commercial " table ?
2 . if so , how does commodity structuring get equitable rankings and equitable compensation ?
3 . if not , what table should commodity structuring be on and how should they be compensated ?
i believe that the people in my group are " commercial " because the organization expects them to do the following :
understand and structure any commodity transaction
see the " big picture , " as well as the detail
accurately and completely identify and cost / value all parts ( risks and opportunities ) in commodity transactions
develop and propose alternate deal structures
customer interface ( with and without originators ) to field technical questions , negotiate technical issues and / or conduct due diligence
review contracts , draft language , recommend changes and insure risk coverage therein
collaborate with research group to develop new models to price / value non - standard product offerings
represent the desks in risk mitigation while negotiating with the desks to get fair / reasonable quotes
make sure all the bases have been covered on a deal and that the deal value ( including desk reserves , cof , credit , legal , etc . ) matches the booking / unwind .
in essence , everything that an originator should do , except considerably more technical in nature , but without primary customer relationships , deal identification responsibilities and specific profit goals . i recognize that the exceptions are very important distinctions and do not want to infer that the roles are the same . in fact , maybe it is the exceptions that determine the distinction . however , commodity structuring , maybe more that any other single group , is hiring , training and developing individuals that regularly transition into " true " commercial seats ( origination and training ) at the request of the leaders of those groups .
i would like to fully discuss and get resolution before the prc process gets underway . can we meet soon ? please advise .
regards ,
ed