Banks, commodities and US reform plan

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US President Barack Obama's proposed plans to reform trading at banks follows a sustained period of expansion in the commodities and energy sectors by financial institutions.

Goldman Sachs is the biggest bank in commodities measured by the amount of money at risk on any given day, known as Value at Risk (VaR).

JP Morgan Chase is the second largest. It is in exclusive talks to buy the RBS Sempra commodities joint venture in a deal worth about USD 4 billion, people familiar with the matter said.

The following are some facts about banks' commodities business.

Credit Agricole CIB

Global head - Martin Fraenkel

Staff - Plans to have 90 global trading staff by end of 2010, up from about 50 in 2008. Announced plans to hire five new people to join its commodities metals team in Europe and Asia in January.

History - Started in commodities over 20 years ago. Changed its name from Calyon in February 2010.

Focus - Active in oil, natural gas and carbon markets, mostly derivatives. Started trading agricultural commodities about 18 months ago. Has no physical assets. Also involved in project finance.

Growth plan - Will start trading European physical gas and power and coal derivatives through joint venture with EDF Trading by the end of March, Fraenkel said in a Reuters interview.

Morgan Stanley

Global head - Simon Greenshields and Colin Bryce

History - Has expanded rapidly to become No. 3 bank in the sector by VaR.

Focus - Crude oil, oil products, natural gas, power, base metals, emissions.

VaR - Around USD 23 million in Q4 2009

JP Morgan Chase

Global head - Blythe Masters

History - Acquired Bear Stearns in March 2008 and increased commodities business. Expanded presence again in February 2009 when it completed purchase of key parts of UBS commodities.

Focus - Actively trades oil, refined products, power, natural gas, coal and emissions. Also active in agricultural commodities such as palm oil and cocoa and base metals.

Growth plan - To be a top-tier franchise globally.

VaR - Has moved into second place with a commodities-market VaR of just over USD 30 million on average last year.

RBS Sempra

Global co-heads - Mike Beck and Michael Goldstein replaced Kaushik Amin after he resigned in late January.

History - Commodities joint venture between the Royal Bank of Scotland and Sempra Energy was created in April 2008. European Commission state aid requirements will force RBS to divest its share over the next four years. JPMorgan and Sempra Energy may carve up the joint venture RBS Sempra, people familiar with the matter said.

Focus - Mainly active in physical markets and its main markets are crude oil, base metals, European power gas and coal and North American gas and power. It also trades U.S. agricultural products and emissions.

VaR - Average of 16.7 million pounds (USD 26.96 million) for Q3 09

Goldman Sachs

Global head - Isabelle Ealet

Staff - More than 200 commodity professionals globally in locations such as New York, Calgary, Houston, London, Sydney, Singapore and Tokyo

History - Entered commodities sector in 1981 with purchase of J. Aron.

Focus - Serving corporate clients and investors ranging from hedge funds to institutional investors and private equity firms. It is one of the few investment banks in the world that physically trades and ships crude oil.

VaR - Goldman Sachs is the biggest bank in commodities with a VaR of around $40 million for the past two years.

Bank of America

Global co-heads - David Goodman and Rob Jones, based in London and Houston.

History - Merrill Lynch acquired energy trading businesses of Entergy-Koch, LP.

Focus - Structuring, trading and marketing natural gas, power, crude oil, refined products, coal, emissions, metals, commodity indices, and structured notes. Involved in both financial and physical markets.

Growth plan - Announced last August it intends to expand commodities team 25 percent over 2-3 years in anticipation of strong commodities demand.

Deutsche Bank

Global head - David Silbert

History - Launched five-year commodities and energy expansion plan in 2007.

Focus - Deutsche is active in oil, refined products, metals, gas, power, agriculture and carbon markets, financial investor products. Has a spot presence in metals and uranium but not active in the physical oil business.

Growth plan - It has increased its headcount by 15% in 2009 and plans to continue hiring in 2010.

It recently opened a new office in Houston, Texas and started trading US power and gas. A bank spokesman said it had experienced "spectacular" growth in Asia. The bank said it has launched 11 new commodity indices, three new commodity systematic mutual funds and one new commodity exchange traded fund this fiscal year.

VaR - Average of 15.4 million euros (USD 21.65 million) for Q1-Q3 2009

Societe Generale

Global head - Edouard Neviaski since 2008. He joined SocGen in 1989 as an energy trader.

Staff - Between 300 and 400 commodity professionals, including 10 for research alone, based mainly in Paris, London, New York and other locations such as Singapore, Hong Kong, Sydney, Houston and Calgary.

History - Started in commodity derivatives in 1988 and in commodity financing 30 years ago.

Focus - Crude, refined oil products, natural gas, coal, CO2, base and precious metals, plastics, grains, sugar and livestock.

Growth plan - Being among the top five banks and in the commodities realm and double revenues by 2012. Hiring globally and increasing the number of clients by more than 20 percent. The bank also plans to develop its offering for investor clients on flow business, indices and structured products.

VaR - 8 million euros (USD 11.25 million) in Q3 2009

Macquarie

Global head - Andrew Downe

Staff - 680 in commodities and treasury combined.

History - Has provided trade financing and risk management services across commodities complex since the early 1980s. It is among the longest-standing providers of agricultural over-the-counter derivatives and tailored risk management services in the financial sector.

Focus - Macquarie is active in metals, agricultural commodities, oil, products and natural gas.

Australia and New Zealand Banking Group

Global head - Christophe Renaud. He joined in 2006 from Societe Generale where he was a commodity derivatives trader.

History - Started in gold in 1996 and expanded into base metals and agricultural commodities in late 2000. Since 2000, it has entered the oil, thermal coal, electricity and emissions markets.

Growth plan - It has hired 12 people in Asia since the start of 2008.