BGC Partners Advisory, a boutique financial restructuring firm launched earlier this year by former Citigroup Inc. bankers, has decided to wind down its operations. The firm, which counted Puerto Rico's powerful financial oversight board as a major client, has formally notified the board of its plans to dissolve.
End of a Short-Lived Venture
BGC Partners was formed in January 2024 by David Brownstein, the former head of Citi's now-defunct public finance department, along with his ex-colleagues John Gavin and James Castiglioni. The firm specialized in complex restructurings, drawing on the trio's experience with some of the largest bankruptcies in the US municipal bond market.
According to a person with direct knowledge of the situation, the firm's dissolution has been confirmed. The most recent contract between BGC and Puerto Rico's financial oversight and management board concluded on June 30. The firm submitted its final application for fees and expenses to the island's bankruptcy court in September, marking the end of its professional engagement.
Impact on Puerto Rico's Power Debt Crisis
Matthias Rieker, a spokesperson for the oversight board, stated in an email that BGC has informed the board of its intention to dissolve. He emphasized that the decision is not expected to impact the ongoing debt restructuring of the Puerto Rico Electric Power Authority (Prepa). Prepa has been bankrupt since 2017, with nearly $9 billion in debt still unresolved.
The bankruptcy process for Prepa stalled last year as the court focused on a dispute between bondholders and the oversight board regarding the utility's revenues. This shift in legal focus drastically reduced the advisory workload for BGC, contributing to the firm's decision to disband. The oversight board stated it will announce its future plans for a financial advisor in due course.
Controversy and a Key Hire
BGC faced public scrutiny in August when its $850,000 monthly retainer from the oversight board was highlighted on social media by far-right activist Laura Loomer. The board itself has been a subject of political turbulence; the Trump administration fired most of its members in the past, citing slow progress on the island's bankruptcies, though a judge later reinstated three members.
Concurrently, one of BGC's founders has moved on. James Castiglioni, a former head of financial structuring at Citi with nearly 14 years at the bank, has joined Huntington National Bank. According to Samantha Costanzo, Huntington's head of public finance, Castiglioni started as a managing director in New York on Monday. He will serve as a senior banker covering US clients and providing financial modeling expertise to the team.
Costanzo praised Castiglioni's significant experience with large, complex issuers, stating his hire will help the bank deepen its client coverage. BGC Partners did not provide an official comment on its dissolution.
