Carlyle bulks up financial services team

US buyout firm The Carlyle Group has expanded its financial services team with a string of high profile appointments, after closing a real estate and a European fund last week.

The Carlyle Group has recruited six members for its financial services team, including former chairman of JPMorgan Chase Sandy Warner and former US Treasury official Randal Quarles, according to UK newspaper Financial Times.

Randal Quarles

Carlyle formed its financial services team in July. It is looking to raise a dedicated fund to invest in the sector.

Warner and former vice-chairman and chief financial officer of bank US Bancorp David Moffet will become senior advisors, while Quarles will become managing director. 

Warner led the $31 billion merger of JP Morgan and Chase in 2000. Quarles was former undersecretary of the US Treasury for domestic finance.

Carlyle has also hired Goldman Sachs financial institutions group employees John Redett and Keith Taylor and former research analyst at asset manager Legg Mason, Reed Deupree.

When the team’s launch was announced, Carlyle co-founder David Rubenstein said in a statement: “The global growth in demand for financial products and services combined with our ability to attract accomplished professionals makes this an opportune time to start this new investment practice.”

It has been a promising September for Carlyle, which closed a $3 billion real estate fund and a €5.35 billion European fund last week. However, last month, the firm was forced to bail out its listed fund Carlyle Capital Corporation with two loans. It issued an apology to investors in the fund for its failure to communicate the reasons for the bail outs directly.

Most private equity firms have avoided financial services for a number of years due to the regulation associated with the sector. However, interest is growing in the space with a JC Flowers-led consortium currently buying US student loan provider Sallie Mae and the Cerberus-led consortium buying the financial services arm of Chrysler as well as  buying the motoring company from DaimlerChrysler. 

Some firms like Advent International have been active in the space for a over 20 years. Advent bought domestic insurer Domestic & General in the first UK take-private since the problems in the debt markets last week.