For Robert C. O'Brien switching from investment banker to commercial banker is as easy as flipping over the identification badges displayed back to back in his wallet.
One badge allows him to enter CS First Boston, the investment banking unit of CS Holdings, where he had been a managing director of leveraged finance for the last two years. The other provides him with access to his new office at Credit Suisse, the commercial banking unit where he now heads North American operations.
Mr. O'Brien's arrival in the banking unit last month signaled a unification - under way for two years - of the Zurich-based holding company's commercial and investment banking arms.
And his promotion underscores the momentum the holding company says it has gained in combining the two businesses. Mr. O'Brien's new job also reflects the higher importance Zurich-based CS Holdings has placed on acquisition finance in this country, even as the company engages in merger talks with Union Bank of Switzerland. Those talks were disclosed this week.
"The Swiss have identified North America as what they call their second home market," said the 52-year-old Mr. O'Brien. "This is a major investment for them. Just the fact that I am in this position here is a statement."
Indeed, the team of Mr. O'Brien and several other key executives, including Bruce Ling, Mark Patterson, and Rick Ivers, was hired just two years earlier from New York-based commercial banks, and has begun to transform Credit Suisse from an underwriter and leader of investment grade loans into a full-service institution capable of adding acquisition loans to its financing arsenal.
In 1995, Credit Suisse acted in any of five different lead roles - arranger, agent, administrative agent, documentation agent, or syndication agent - on 21 deals for more than $27 billion in acquisition-related finance, according to Loan Pricing Corp.
That places Credit Suisse second in acquisition finance to Chemical Banking Corp., which led deals worth more than $41 billion, and ahead of No. 3 Citicorp's more than $22 billion.
Mr. Ling, a senior managing director and head of syndications at Credit Suisse and managing director at CS First Boston, said that the bank has not had any problems with delays in credit decisions because of its foreign base.
"We have been able to make the organization respond to the marketplace," he said. "The turnaround time has not been a disadvantage for us because Credit Suisse is fully committed to the business."
During the past two years, that commitment has resulted in some attractive deals.
The bank won a marquee deal for Italian eyeglass maker Luxottica Group in its acquisition of U.S. Shoe. Credit Suisse completely underwrote a $1.55 billion credit facility that was named Euromoney deal of the year, while CS First Boston acted as the mergers and acquisitions adviser.
The Luxottica deal is "evidence that we've demonstrated that we've got it right," said Mr. Patterson, a managing director at CS First Boston in charge of the leveraged finance group.
"The power of the mergers and acquisitions idea may have won through in the end," he said. "When you have one and a half billion (dollars) sitting on this side of the table and a great mergers and acquisitions capability on the other side, it's a lay-up."
The approach is one that some bankers in the United States understand, and several have even suggested an interest in emulating.
"Their pitch is that they will go to a client, come up with an idea to buy something, bridge it with a loan, and add a component with high-yield bonds," said a bank loan syndicator.
Some corporate customers are not sold on the idea of doing all their commercial and investment banking business with one institution.
"We have not found sufficient reason to abandon our traditional longstanding relationships" with investment banks, said Maris Andersons, a senior vice president and treasurer of Tenet Healthcare Corp. Credit Suisse is one of Tenet's lenders. Allocating lead positions on financing deals is something that "is decided based on where the relationships have developed," he said.
Still, the joint marketing effort has won repeat business for both Credit Suisse and CS First Boston.
"We have done six consecutive deals with them," said David Sokol, the chairman of Omaha-based California Energy. "That's much more than with any institution in the past."
Mr. Sokol said that he chose to work with Credit Suisse and CS First Boston separately, and found that the two banks worked well together.
"The real benefits of working with them was the fact that they can work together," he said. "That's unique. We've had several instances where a First Boston banker will openly say that the better way to do something is with the bank, where his own interest would be to tell us to use the bond markets."
Lately, however, the bank, along with much of the rest of the market, has not been particularly active in originating deals.
"Because of the nature of the business and our approach to the market, the organization will go through periods where there is an active time and a quiet period," Mr. O'Brien said.
"We're redirecting our resources out into our regular corporate market out there to solidify our positions and to pursue the constant up-tiering of our relationships with our existing clients," he said.
The unit also faces challenges created by the defection of some key bankers from the ranks of CS First Boston.
"There will be change and 60 days from today, every desk will be filled with confident, professional people," Mr. O'Brien said.
As for the joint marketing effort, Mr. O'Brien said the group doesn't really have any holes to fill, other than the one created by his own promotion, which will take him further from the daily business of transactions.
The group is looking to grow, and will hire three or four bankers in the near future.
"This has been a very profitable exercise, and more importantly, I think we've done a lot to add value for our clients," Mr. Ling said. "It's still got a lot of potential, which is as noteworthy as our profitability."
