Colleagues who have traveled with Adebayo Ogunlesi during his years as a globe-trotting dealmaker have seen him face down bribe-seeking gunmen in his native Nigeria and effect a clever predawn escape from student rioters in Indonesia. But today Ogunlesi confronts a crisis that in many ways is scarier: he's the new head of worldwide investment banking at Credit Suisse First Boston (CSFB), which lost nearly $1 billion last year and faces accusations that its advice to investors was corrupted by its desire to please big corporate clients.
A standing ovation at his first staff meeting in February did not deter Ogunlesi, 48, from delivering a sobering message: he would have to "break some glass" to control spiraling costs. Within weeks CSFB laid off 300 bankers, or 14% of Ogunlesi's division. The survivors with guaranteed contracts were asked by Ogunlesi to accept pay cuts. He pushed the bankers out of limos and required them to hail taxis. And he freed 12 top revenue producers of daily management responsibilities so they could spend more time generating business.
These measures have bred early successes. CSFB has maintained its global No. 1 ranking among banks issuing high-yield bonds, and it has moved up three spots, to second place, in mergers and acquisitions. Second-quarter revenues increased 25% over the first quarter's but like its competitors, CSFB saw revenues slump in the third quarter. The firm denies allegations by the state of Massachusetts that it tainted stock research to favor its investment-banking clients.
Ogunlesi, whose father was the first Nigerian-born medical professor tenured in his home country, studied philosophy, politics and economics at Oxford and then earned law and business degrees from Harvard. He clerked for Supreme Court Justice Thurgood Marshall--who, unable to pronounce his name, dubbed him "Obeedoogee." (Most friends and colleagues today call him Bayo.) Ogunlesi joined the top-shelf New York City law firm Cravath, Swain & Moore, where he jumped at the chance to advise First Boston on a Nigerian gas project. Success in that effort landed him a better job at First Boston (which was acquired by Credit Suisse in 1997). For First Boston he worked in project finance, brokering deals in which lenders finance assets like oil refineries and mines and are repaid with revenues generated by those enterprises.
Based in New York City and traveling to emerging markets, he built CSFB's project-finance business into the world's best, in part by encouraging corporations and governments to tap public debt markets in addition to commercial lenders. That strategy allowed the debtors to borrow for longer periods and reduce their short-term costs. When Ogunlesi's project-finance group absorbed several other divisions, a colleague produced T shirts that read, "I've Found Happiness in the Bayosphere."
Today there's little happiness in financial services. Ogunlesi urges demoralized bankers to stay in front of clients and advise them on non-deal-related matters like industry trends, a strategy that pays off once the deals return. Says David Sokol, CEO of MidAmerican Energy Holdings and an Ogunlesi client: "Bayo is a person whom you can talk to about any issue, whether or not his firm is working on it."