Credit Suisse has become the latest firm to report a casualty in its financial sponsor coverage group in Asia with the resignation of Ronan Agnew.

Agnew had been head of financial sponsor coverage for Asia since May 2008. He reported to Paul Raphael, head of investment banking in Asia Pacific (ex-Japan), and Harold Bogle, global head of financial sponsors coverage. Having moved to Hong Kong from London, where he had been co-head of the European financial sponsors group since 2005, to take up his Asia-focused job last year, he is now moving back to London for personal reasons, say sources close to the development.

Agnew is a career private equity banker. He joined Credit Suisse in November 2000 after the bank's merger with Donaldson, Lufkin & Jenrette. At DLJ he was a senior member of the European leveraged finance/financial sponsors coverage group.

Credit Suisse has decided not to replace Agnew and instead, the two directors who were hitherto reporting to him, Toby Groser and Ben Ngai, will jointly head the group. Groser is a veteran at the Swiss bank while Ngai joined from Citi in September 2007 to enhance the bank's focus on China.

Despite Agnew's departure, sources say that Credit Suisse remains committed to sponsor coverage in Asia. "Credit Suisse did not downsize its sponsor coverage group in its round of layoffs in December but maintained it at six people," says a source with knowledge of the matter. In December, the Swiss firm announced it would reduce global headcount by 5,300 people, or 11%, by the end of 2009 with investment banking accounting for 72% of the total cuts.

Credit Suisse has also decided to change the reporting line for the financial sponsors group. It will no longer report to Raphael but to Joe Gallagher, head of mergers and acquisitions for Asia-Pacific. Groser and Ngai will continue to report to Bogle.

"The change in reporting lines reflects the fact that the financial sponsor transactions we anticipate will be M&A-driven in the near-term," says a source. "Difficult equity markets and the drying up of leveraged finance suggest M&A will be critical to both investments and exits by our sponsor clients." By changing the reporting lines, Credit Suisse hopes to shorten the communication between the sponsor coverage team and the product team.

Agnew may have decided to take a break for personal reasons, but there has been a trend across global banks in the region to downsize their private equity teams in Asia as activity involving private equity firms has dried up. And the casualties have been at senior levels. Most investment banks had added strength in Asia in both their financial sponsor coverage and leveraged finance teams as the region was being targeted by a number of global sponsors for buyouts. But as credit markets have dried up, private equity firms have been forced to revisit their plans causing a lull in activity.

In early December last year, Citi announced that Chris Laskowski, who started Citi's financial sponsor business in Asia four years ago, was relocating to Chicago to head up the same operations in the US Midwest region. With Laskowski's departure, Citi's financial sponsors team, termed the financial entrepreneurs group (FEG), is now headed solely by Chris Gammons. Laskowski brought Gammons on board from Deutsche Bank in May 2007 to work alongside him and head leveraged finance for FEG.

And in a round of headcount reductions later in December, Morgan Stanley retrenched the head of its Asia-Pacific private equity banking team, Jonathan Mandel. Mandel had been appointed to run private equity for the Asia-Pacific region less than a year earlier, after being made managing director by the US bank in December 2006. The other senior member of Morgan Stanley's financial sponsors group, Stephen Seelbach, who is an executive director, remains with the group.