Deborah Cohen Malka, Partner and Portfolio Manager at AlbaCore Capital talks to Lynn Strongin Dodds about goals, career and opportunities.
Starting a new job can often be a baptism of fire experience, but this was certainly the case for Deborah Cohen Malka at European based alternative credit specialist, AlbaCore Capital. She was a summer intern at Goldman Sachs in 2007 before officially starting her career the year after the global financial crisis was kicking off. It seems that this character-building experience has held her in good stead over the past three tumultuous years.
“I started my career right before Lehman collapsed and saw all these people being let go and leaving the office with boxes,” says Cohen Malka, who focused on M&A, corporate finance and initial public offerings at Goldman. “I made it through, but it definitely gave me a perspective on the markets. I learnt that they do not always behave as people expect. There is downside and things could go wrong.”
This is a lesson that many in the industry are learning today the volatility experienced since 2020 has not been a feature for years. Few predicted that 2022 would be rocked by a prolonged war in Ukraine which exacerbated an already weakening economic picture. Inflation hit record levels, central banks tightened, and markets gyrated, This is not even mentioning the political upheaval in the UK which saw three prime ministers in three months.
“A lot of people in the industry have not yet experienced these types of markets,” she says. “When they started, inflation and interest rates were low and there were only a few periods of volatility,” she says. “I realised that part of my job was to reassure and explain that the current market environment also creates great investment opportunities”
Cohen Malka, who started at AlbaCore in 2016, helps to lead an investment team of 19 people. The investment firm is known for collaterised loan obligations (CLOs) which are a portfolio of predominantly leveraged loans that is securitised and managed as a fund. The assets are typically senior secured loans, which benefit from priority of payment over other claimants in the event of an insolvency. Each CLO is structured as a series of tranches that are interest-paying bonds, along with a small portion of equity.
In addition, the asset manager offers a broader product menu of closed and open-ended funds, including a credit opportunity fund and bespoke solutions to individual investors.
Around 70% of Cohen Malka’s time is spent on portfolio management and deal sourcing, with the remainder targeted towards fund raising, deal execution as well as recruitment and mentoring within the wider organisation. “At the end of the day we are asset managers, performance is key,” she says. “However, it is a balancing act as a manager in setting clear goals, how we are doing to achieve these goals and coaching and mentoring the team to ensure they are well equipped to reach them.”
Of course, hitting those targets this year has been more challenging than in the past, Volatile markets, though, can also be a time for active portfolio managers to shine and unearth attractive prospects. Good quality data in finding the right entry points is only one part of the equation, according to Cohen Malka. “You cannot just rely on technology, you need to have knowledge of the sector and sub sector,” she says. “Relationships are also very important with counterparties and companies. You need to understand how the management team thinks and what their plans are to better assess the credit and default risks.”
Cohen Malka also believes human interaction is essential in the workplace although is happy to offer flexibility to a certain extent. Many fund managers including AlbaCore have offered flexible working to their teams in the post pandemic era. “I think working from home has several benefits,” she says. “However, when we emerged from Covid, the next evolution and competitive advantage means getting out and building a network and relationships. It is also important to be in the office and work together as a team. People are also looking for career development and want to be promoted. It is my job to provide that guidance and support and some of those conversations are easier in person.”
As for her own career, it is not surprising Cohen Malka decided to forge a path in financial services. She did not follow in the footsteps of her parents who were in the medical profession but gained a master’s in management with a major in financial engineering at ESCP Europe Business School. She has honed her skills while working in high yield, private debt, private equity and corporate finance.
As Cohen Malka put it, “When I went to university I was not thinking about my career. I liked maths and the French system is very good at maths, so I decided to go to business school. Part of the course was a one-year internship at PAI Partners (a private equity firm in Paris) which I really enjoyed because it enabled me to use my mathematical skills. However, at the time, private equity firms didn’t recruit people right out of school, so I joined Goldman Sachs as an intern and then as an investment banking analyst once I graduated.”
Although Cohen Malka acknowledges the long hours that Goldman juniors and seniors work, she believes the “training was good, the people were interesting, and it was great platform to develop a network. Many of the people I work with today I met while I was at Goldman. People did not expect me to move from Goldman but after three years of banking, I wanted to go back to private equity.”
She joined the investment team of CCMP Capital Advisors as an associate before moving to the $542bn Canada Pension Plan Investment Board (CPPIB, now CPP Investments), where she was responsible for deal sourcing and execution in the principal credit team. It is here where she met AlbaCore founder David Allen who at the time in 2013 was managing the CPP Investments’ European Principal Credit Fund. The team worked together running execution for the Private Debt business and, in 2016, David launched AlbaCore, seeded by Canadian pension investment manager PSP Investments, which remains a minority equity investor and a large limited partner. AlbaCore has, since then, become a leading European specialist credit investment firm.
“I learned a great deal from David and decided to move with him when he set up AlbaCore,” she says. “He not only taught me how to model a company but also to be more open about potential opportunity sets. This also applies to the recruitment process. When I hire someone, I expect them to also interview me.”
Overall, the firm is known for its collaborative and diverse culture, where talented young people are hired and trained to eventually become partners. “On the broader diversity and inclusion we have committees that work in different streams and also have mentoring programmes targeted at helping people from a wide range of backgrounds” says Cohen Malka.
She adds, “I didn’t personally experience any discrimination in my career but when I started working, I was often the only woman at events. Things have progressed and at AlbaCore, women are well represented on our executive team. However, it is not just about improving the diversity of firms but finding ways at how we can keep the best candidates. For example, when someone takes maternity leave, there can be a crisis of confidence, but we make sure that we have ongoing dialogues so that the return to work is as seamless as possible.”
©Markets Media Europe 2022
