RBC parts with top-ranked mining analyst Josh Wolfson, poaches Scotia’s Ovais Habib

Detailed summary

Investment bank is moving to broaden its focus on mid-cap mining companies, which can generate higher fees than the major miners

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. 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.

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.

Opening of the article, excerpted from The Globe and Mail (Report on Business). To read the rest, open the article on the publisher's site.