Tricolor, Fiserv Show Value of Junior Bankers: Paul J. Davies

The warehouse that turned hundreds of millions of dollars of auto loans from Tricolor Holdings LLC into bonds was run by one of the biggest and most sophisticated investment banks in the world, JPMorgan Chase & Co. It has decades of experience creating and managing such facilities for many kinds of firm producing asset-backed debt.

And yet, it was a junior analyst at another fund manager helping to finance the $770 million Tricolor warehouse who first spotted issues with the now bankrupt lenders’ use of collateral, according to Bloomberg News. The unidentified young professional at Waterfall Asset Management prompted JPMorgan’s bankers ...