Open this photo in gallery:
Sanam Heidary, global head of communications at RBC, said the hiring of Mr. Habib reflects RBC’s ‘broader strategy to invest in its mining business across the platform.’The Globe and Mail
RBC Dominion Securities Inc. has parted ways with its long-time head of global mining research Josh Wolfson and is poaching Scotia Capital Inc.’s Ovais Habib, as the big Canadian investment bank broadens its platform to focus more on covering mid-cap mining companies.
Mr. Wolfson had been with RBC for seven years and was a well-respected analyst who covered large miners such as Barrick Mining Corp. ABX-T, Agnico Eagle Mines Ltd. AEM-T and Newmont Corp. NEM-N He was frequently ranked in the top tier of his peers by Extel, which tallies the quality of analyst research. Earlier in his career, Mr. Wolfson was managing director, equity research with Desjardins and before that he worked as an analyst at boutique investment bank Eight Capital.
Mr. Habib joined Scotia in 2011 and is known for covering mid-cap miners such as B2Gold Corp., Centerra Gold Inc. and Equinox Gold Corp.
Sanam Heidary, global head of communications at RBC, wrote in an e-mail to The Globe and Mail that the hiring of Mr. Habib reflects RBC’s “broader strategy to invest in its mining business across the platform.”
Mr. Habib could not be reached for comment.
Mr. Wolfson recently updated his LinkedIn to reflect that he has left RBC. He declined comment.
RBC declined to comment on the reasons behind the departure of Mr. Wolfson.
RBC cuts high-level climate finance jobs in unit restructuring
Companies don’t generally pay for equity research directly but can reward a bank’s investment banking arm with corporate financing business. While a handful of large miners grab a lot of the attention, mid-cap companies, which are far more numerous, can generate higher investment banking fees for banks. That’s because of their need to raise money in stock issuances, and a higher frequency of deal-making.
As the big banks grapple with how to increase their corporate financing businesses, they are also dealing with a brain drain with some veteran analysts fleeing to the corporate sector.
For example, Darko Mihelic, a long-time and highly ranked banking and insurance industry analyst, recently left RBC to join Sun Life Financial Inc. as its head of investor relations.
Equity analyst is seen as one of the most difficult jobs on Bay Street. While analysts are “walled off” from a bank’s corporate financing division, there can be subtle pressure on them to produce research that is positive in tone, as the companies they write about can generate significant investment banking fees.
RBC’s Mr. Wolfson was known for his incisive research, and he did not shy away from critical commentary when companies fell short. He also wasn’t afraid to prod executives for more information in quarterly earnings calls, particularly when he felt they weren’t being sufficiently transparent.
Last year, Mr. Wolfson pressed Barrick’s executives in an earnings call for more specifics around the miner’s weaker-than-expected production forecast. The executives declined to elaborate and Mark Bristow, the chief executive officer at the time, admonished Mr. Wolfson in the call for “trying to nitpick” about the details.
Barrick files paperwork in U.S. for public offering of its North American business
RBC isn’t the only bank making changes in its mining capital markets team.
Mining and metals equity research analyst Craig Stanley has left Raymond James. He had been with the company for more than six years.
An automated e-mail response to a request for comment sent to Mr. Stanley’s Raymond James account said that he is no longer with the bank.
Raymond James declined comment on the departure of Mr. Stanley.