Corporate crisis a timely wake-up call
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Tuesday, 16 July, 2002 - 22:00
AS the US equities market convulses from the shock news of company collapses and massive reporting breaches, few people are as close to the action as former Perth accountant Tim Andrew.
Eight years after deciding to become an equities analyst, Mr Andrew has risen to the top of the tree and is now managing director at Deutsche Bank Securities Inc’s 300-strong US equities team.
He appeared quite calm about the current corporate crisis when interviewed by WA Business News, despite the fact that analysts are being held partly responsible for the volatility in the US.
“It is a messy landscape,” Mr Andrew said, not just regarding the events unfolding in the US stock market, but also the titanic struggle for market share among the global investment banks prompted by the meltdown on Wall Street.
He believes the top 10 investment banks will consolidate to about six, as they move to cut costs and position themselves as truly global players.
And it may be some time before the market of two years ago is revisited, when new listings came thick and fast, aided by cosy deals with analysts who seemed unable to find a bad thing to say about any stock.
Mr Andrew said that he, along with virtually every senior analyst in New York, had been subpoenaed by Securities and Ex-change Commission in its investigations into the conflicts between investment houses’ corporate advisory and analysis divisions.
But he remains unperturbed by this inquiry, believing that the US market needed a wake-up call.
“I don’t know how the market is going to shape up, I don’t think it has bottomed but we are close,” Mr Andrew said.
“The more of these things (like Enron, WorldCom) that come out of the closet, it is a case of sooner rather than later.
“We don’t need death by a thousand cuts.”
He said US analysts had had it too easy and it was time for big changes.
“Analysts will have to get more back to basics,” Mr Andrew said.
“There were no tyre kickers, no-one was doing anything different.
“We have to add value, deep fundamental research is my mantra.”
Based largely in Hong Kong since switching from accounting to investment banking in 1994, Mr Andrew moved to New York after a brief stint managing the equities team in Sydney, which was ranked ninth nationally when he got there and fourth when he left.
Despite enjoying the Sydney lifestyle he decided to leave after realising Australia did not offer the career potential.
“It was tiny and irrelevant; I found it difficult to get excited about it once I had built the business,” Mr Andrew said.
“I am not trying to be an Aussie basher, I really miss it.”
In fact, Mr Andrew revealed he misses so much that he had every intention of returning in the foreseeable future.
With two young children, he and his wife had decided that by the time the oldest had reached primary school age the family would shift back to Perth, where they have bought property in preparation for such a move.
“Having our kids so far from our parents is just terrible,” Mr Andrew said.
Eight years after deciding to become an equities analyst, Mr Andrew has risen to the top of the tree and is now managing director at Deutsche Bank Securities Inc’s 300-strong US equities team.
He appeared quite calm about the current corporate crisis when interviewed by WA Business News, despite the fact that analysts are being held partly responsible for the volatility in the US.
“It is a messy landscape,” Mr Andrew said, not just regarding the events unfolding in the US stock market, but also the titanic struggle for market share among the global investment banks prompted by the meltdown on Wall Street.
He believes the top 10 investment banks will consolidate to about six, as they move to cut costs and position themselves as truly global players.
And it may be some time before the market of two years ago is revisited, when new listings came thick and fast, aided by cosy deals with analysts who seemed unable to find a bad thing to say about any stock.
Mr Andrew said that he, along with virtually every senior analyst in New York, had been subpoenaed by Securities and Ex-change Commission in its investigations into the conflicts between investment houses’ corporate advisory and analysis divisions.
But he remains unperturbed by this inquiry, believing that the US market needed a wake-up call.
“I don’t know how the market is going to shape up, I don’t think it has bottomed but we are close,” Mr Andrew said.
“The more of these things (like Enron, WorldCom) that come out of the closet, it is a case of sooner rather than later.
“We don’t need death by a thousand cuts.”
He said US analysts had had it too easy and it was time for big changes.
“Analysts will have to get more back to basics,” Mr Andrew said.
“There were no tyre kickers, no-one was doing anything different.
“We have to add value, deep fundamental research is my mantra.”
Based largely in Hong Kong since switching from accounting to investment banking in 1994, Mr Andrew moved to New York after a brief stint managing the equities team in Sydney, which was ranked ninth nationally when he got there and fourth when he left.
Despite enjoying the Sydney lifestyle he decided to leave after realising Australia did not offer the career potential.
“It was tiny and irrelevant; I found it difficult to get excited about it once I had built the business,” Mr Andrew said.
“I am not trying to be an Aussie basher, I really miss it.”
In fact, Mr Andrew revealed he misses so much that he had every intention of returning in the foreseeable future.
With two young children, he and his wife had decided that by the time the oldest had reached primary school age the family would shift back to Perth, where they have bought property in preparation for such a move.
“Having our kids so far from our parents is just terrible,” Mr Andrew said.