Bombay's Dalal Street witnessed a high profile defection yesterday (January 9) when Mihir Doshi, head of JM Morgan Stanley Securities resigned to join CSFB where he is expected to be primarily responsible for building up the firm's broking business.

His departure from Morgan Stanley, where he has spent the last 22 years, was not entirely unexpected and came on the day he banked his annual bonus. Two of his chief global mentors - Vikram Gandhi and Vikram Pandit - have both left the US investment bank over the past year following tussles over ousted CEO Philip Purcell's leadership.

At CSFB, Doshi will join Ajeya Singh, son of former Prime Minister VP Singh and one of the country's most well connected rainmakers. The combination of the two men should be highly complementary.

Singh's corporate and government connections will help CSFB to win new investment banking business; while Doshi brings with him a track record at one of India's top banks, a proven ability to build an equity broking franchise, and the respect of international investors, local players and regulators.

Says Arshad Zakaria, CEO of New Vernon Capital - one of the top foreign hedge fund investors in India, "Doshi is unusual because he has demonstrated exceptional leadership qualities as well as a very good background in watching the Indian market evolve over the last 10 years. I have known him in a personal and professional capacity and I think he's an excellent choice to build an organization both because of his leadership qualities and his deep knowledge of the Indian market."

"He is one of the best professionals I have ever come across," adds Naresh Goyal, Chairman of Jet Airways. "He is one of the truest professionals I have ever come across. When he tells you something will be done, it will be done. He's a man of great integrity, commitment and is a loyal friend."

Doshi's appointment shows how serious CSFB is about prioritizing the re-building of its Indian franchise. Singh was initially hired in August 2003 to help win back the four FII licenses CSFB lost in the wake of a regulatory ban stemming from the Ketan Parekh stock market scandal of 2001 when the local stock market completely collapsed.

Over the past four years, the bank has had plenty of time to regret the elephant sized hole in its Asian footprint. Booming capital markets have placed the country on every investment bank's radar screen, with CSFB the only major international bank to be largely absent from the party. An analysis of the league tables show that had CSFB been able to execute Indian business in 2005, for example, it may have been able clinch a top five position in the equity league tables, rather than its final position at sixth.

The first signs of change came when the firm's private banking arm launched operations on the subcontinent in 2005. Interestingly, the current US ambassador to India, David Campbell Mulford, (who assumed office in January 2004), was chairman international and a member of the Executive Board for CSFB based in London just prior to his ambassadorial appointment.

Finally in December, the bank won back its coveted FII licenses and announced its intention to re-build a business organically rather than establish a JV.

Indeed Doshi's departure also represents a seminal moment for Morgan Stanley and the JV it established in 1999 with JM Financial, the domestic investment bank founded and still run by Nimesh Kampani. Doshi (commonly known as Mickey) was the first Morgan Stanley employee on the ground in the JM Morgan Stanley organization and until yesterday was the last remaining.

He was initially appointed CEO of JM Morgan Stanley Securities, the equity sales and trading arm. This has always been 51% owned by Morgan Stanley, while the investment banking arm was 51% owned by JM Financial.

When Vikram Gandhi, president of Morgan Stanley Dean Witter India moved back to New York in the late 1990's, Doshi was promoted to vice chairman of JM Morgan Stanley Securities. Gandhi is now head of CSFB's global financial institutions group.

Doshi's departure may also give further credence to rumours about an impending shake-up at the JV. Local bankers believe Morgan Stanley and the JM group may be about to go their separate ways, with the former keeping investment banking, institutional broking and the NBFC (Non Bank Finance Company) license, while the latter will keep retail broking and asset management. Kampani, who is currently chairman of the JV, will then build up a separate investment banking arm using proceeds from his pay out by Morgan Stanley.