Morgan Stanley has become the latest bank to drop shipping coverage and part ways with a veteran analyst after telling clients that Fotis Giannakoulis is no longer with the firm.
The bulge-bracket bank discontinued coverage of 29 shipowners that had been under Giannakoulis' research, according to a note to clients this afternoon.
Giannakoulis becomes the third shipping analyst to part ways with his bank in the last seven weeks, following Magnus Fyhr at Seaport Global Securities and James Jang at the Maxim Group.
Of those, Maxim has formally announced it has dropped shipping coverage.
In recent months, larger banks Credit Suisse and UBS also have dropped their shipping equity researchers.
When an analyst departs a bank, coverage of the stocks under his umbrella is automatically discontinued. It is not a definitive statement that the bank will drop coverage of the sector altogether in the longer term.
But Giannakoulis' move from Morgan Stanley is easily the most concerning to date simply because of the bank's size and central role in shipping capital markets deals — at least when there were more shipping capital markets deals.
Morgan Stanley shipping investment banker Wiley Griffiths has been one of the most active finance men in IPOs and other deals over the last several years. Like many of his counterparts, he is active in other transport sectors as well.
Giannakoulis built up his own following in nearly a decade at the firm. When he came to Morgan Stanley in 2010, it was his first job as an equity analyst. He had previously served as a lender for Fortis and an investment banker for both Fortis and New York's Poten & Partners.
The range of experience made him one of shipping's more diversified analysts.
“When I first came into the industry, one of the first guys I met told me, ‘once you’re in shipping, you’re always in shipping’. I took that as a threat. I wanted to do something else — consulting or investment banking," Giannakoulis told TradeWinds in a 2014 interview.
“Today, I feel blessed to be in this industry. I’ve been very lucky to serve the most exciting industry in the world, with all its ups and downs and so many colourful personalities.”
But now shipping analysts are under pressure to cover adjacent sectors as there is not enough deal flow, trading liquidity and market capitalisation in shipping alone to sustain business.
The initial reaction to Giannakoulis' departure today was summed up by one public chief financial officer.
"Big loss for the industry," he said.
