Top Natixis Salesman Exits After Bank Takes $295 Million Hit

(Bloomberg) -- A senior executive at Natixis SA who helped lead a foray into complex Asian derivatives that went wrong has left the French lender, a person familiar with the matter said.

Nicolas Reille left earlier this week, said the person, who asked not to be identified as the departure isn’t public. His most recent title at Paris-based Natixis was head of global market sales and financial engineering for the Asia-Pacific region, according to his LinkedIn profile.

Reille was among executives who pushed Natixis into the market for Asian equity derivatives, complex contracts that can be more lucrative than trading common stocks, yet also more volatile and harder to manage. The strategy backfired in 2018 when global markets swooned, hobbling the French bank with losses reaching 260 million euros ($295 million) and sending its shares to the lowest in more than two years when it revealed the problems in December.

A spokesman for the Paris-based bank declined to comment. Reille didn’t respond to text messages requesting comment.

The trades that went awry involved so-called autocallables in South Korea, volatile derivatives linked to shares, a person familiar with the matter said in December. Natixis has now “stopped production of these products,” a spokesman for the bank told Bloomberg in December. Cedric Dubois, who was head of equity derivatives for the region, no longer holds that position, the person familiar with the matter said at the time.

Natixis had significantly expanded in South Korea during recent years, partnering with the Korea Exchange in 2017 to create the first index designed for structured products, known as the Kospi 3. Reille, a former Societe Generale SA banker who joined Natixis in 2014, helped promote the expansion.

In an August interview with trade publication Risk.net, Reille described the bank’s growing range of Korean products, including the Kospi 3 and autocallables known as the Cobra, the Triple Lizard and the Flash Lizard.

“With Kospi 3, we are disrupting the largest equity derivatives market in Asia,” Reille said. “Investors’ experience has been very good. Volumes have been growing and we expect them to grow even more this year.”

©2019 Bloomberg L.P.