Berwin Leighton Paisner‘s (BLP’s) head of banking and finance Matthew Kellett is to leave the firm, it was confirmed today (30 October), with BLP launching an independent review of its finance practice.
A spokesperson for the firm said: ‘Matthew Kellett has decided to leave BLP to pursue his business and other interests. Matthew will stay in his role until a successor has been appointed. The finance team continues to retain significant clients and is involved an increasing amount of international and multi-practice work.
The review, which will be overseen by managing partner Neville Eisenberg and executive chairman Robert MacGregor, will see the firm engage an external consultant to assess its 150-lawyer finance practice. The team has undertaken work for the Royal Bank of Scotland, Barclays and Goldman Sachs, but it has a slimmer institutional client roster than some peer group firms.
‘We are also taking this opportunity to conduct an independent review of the department, in conjunction with the finance partners, to assess how best to take advantage of the opportunities for the team going forward.’
The review will raise fresh questions over the future of the firm’s finance practice, which has often been criticised for poor performance and excessive use of expensive lateral recruits.
The firm is already facing intense scrutiny following a difficult period with BLP in 2012/13 seeing profit per equity partner fall 39% from £660,000 to £401,000. Revenues decreased 5% to £233m, making it the worst financial performer of the top UK 25 firms this year.
The firm completed a redundancy round in May, which resulted in the loss of 102 jobs including 58 legal staff and 44 secretarial staff.
BLP also reacted with a shake-up of its partnership that has resulted in substantial numbers of partners being asked to leave. The firm’s woes are believed to be largely due to over-expansion – in particular a number of struggling investments in Asia – and a run of mis-firing senior recruits.
The 220-partner firm – until recently generally regarded as one of the most upwardly mobile practices outside London’s top 10 – has been ready to offer guaranteed pay deals above its core equity ladder for some high profile partner recruits. While the aggressive recruitment strategy has worked well in a number of cases, notably in its core real estate practice, the results have long been viewed as mixed in corporate and finance.
There will be expectations that BLP will reverse its previous attempt to build a multi-product line banking offering in favour of a smaller, support practice to handle mainstream finance work.
Legal Business discussed the review with BLP managing partner Neville Eisenberg who described it as a ‘forward looking’ exercise and ‘not a post-mortem’.
He added: ‘The review is to look at what opportunities we have and to reassess the practice’s resources and whether they’re right for the market. We have a number of teams within finance. [But] we’re not going to focus only on real estate, we are investing in the future.’
Asked about the firm’s decision two years ago to move its profitable property finance team into its real estate practice – a move that was criticised by some internally – Eisenberg said it was ‘the right thing to do’. Eisenberg concluded: ‘After our restructuring earlier this year we are now in good shape.’
For more commentary on BLP click here