Jefferies Financial Group is strengthening its municipal bond business by recruiting experienced sales and trading professionals from Goldman Sachs and Morgan Stanley.
The hiring push includes Stephen DeMarco, who joined Jefferies’ municipal trading desk as a managing director in June, and Robert Bertoni, who arrived as a senior vice president in May. Both previously worked at Goldman Sachs. Another municipal-market veteran is expected to join from Morgan Stanley, according to a person familiar with the appointments.
The moves may look like routine Wall Street personnel changes, but their timing is significant. Municipal bond issuance is running at historically high levels, investor demand remains strong and major dealers are competing for the relationships, trading flows and underwriting opportunities generated by the expanding market.
Jefferies is also coming off a quarter in which municipal securities helped lift its fixed-income performance. Recruiting professionals with experience at two of Wall Street’s most established municipal franchises suggests that the firm intends to build on that momentum rather than treat it as a temporary improvement.
Two Goldman Veterans Have Already Joined Jefferies
The new appointments were first detailed in a Bloomberg Law report on Jefferies’ municipal hiring. DeMarco joined as a managing director, placing him in a senior position on the municipal trading desk, while Bertoni entered at the senior vice president level.
DeMarco spent approximately 16 years at Goldman Sachs after registering with the firm in January 2010. His regulatory history includes qualifications as a municipal securities representative and municipal securities principal, alongside broader securities trading and supervisory registrations. Those credentials indicate experience extending beyond trade execution into the regulatory and operational responsibilities associated with running a municipal securities business. His professional background can be reviewed through FINRA’s BrokerCheck report.
Bertoni worked at Goldman Sachs from 2019 until 2026 and previously spent time at B. Riley Wealth Management and B.R. Seelaus. His move to Jefferies gives the firm another professional with direct municipal trading experience and familiarity with both large institutional platforms and smaller fixed-income operations. FINRA’s BrokerCheck database now identifies Jefferies as his current firm.
The identity of the expected Morgan Stanley recruit was not disclosed in the publicly available portion of the report. The planned appointment nevertheless indicates that Jefferies is assembling a group rather than filling one isolated vacancy.
Why Municipal Trading Experience Matters
Municipal bonds are issued by states, cities, counties, school districts, transport authorities, hospitals and other public or nonprofit entities. The proceeds may finance roads, schools, water systems, airports, housing projects and healthcare facilities.
Unlike the stock market, where a relatively small number of heavily followed companies account for substantial trading activity, the municipal market contains roughly one million outstanding securities. Many individual bonds trade infrequently, and two issues from the same borrower can have different maturities, coupons, call provisions, tax treatment and credit characteristics. The Municipal Securities Rulemaking Board’s market resources illustrate the size and fragmented structure of the sector.
That fragmentation makes experienced traders particularly valuable. Pricing a municipal bond often requires more than observing the most recent transaction. A dealer may need to assess comparable securities, Treasury movements, tax-exempt yields, local credit conditions, investor demand and the amount of similar debt currently available.
Relationships also remain important. Institutional investors frequently look to dealers for market colour, liquidity and access to new issues. A trader who has worked with asset managers, insurance companies, banks and separately managed accounts can bring established connections that would take a less experienced professional years to develop.
Jefferies Is Investing During a Record Market
The hiring campaign comes during an unusually active period for municipal borrowing.
US municipal issuers sold approximately $300.9 billion of bonds during the first six months of 2026, an increase of 5.6% from the same period a year earlier. The market also had about $4.5 trillion of securities outstanding at the end of the first quarter, according to SIFMA’s municipal bond statistics.
The MSRB reported that issuance remained on course for a third consecutive annual record during the first half of 2026. Demand from mutual funds, exchange-traded funds, separately managed accounts and individual investors was also strong, even though the par value traded in the secondary market declined from the record levels reached during the first half of 2025. The complete figures appear in the MSRB’s midyear 2026 municipal market report.
High issuance creates opportunities across the entire municipal platform. Public finance bankers can compete to advise issuers and underwrite new bonds, while sales professionals distribute those securities to investors. Traders then provide prices and liquidity after the bonds enter the secondary market.
A stronger trading desk can therefore support more than trading revenue. It can make the entire underwriting franchise more attractive to issuers because a bank with broad investor distribution and reliable secondary liquidity may be better positioned to place a new bond offering.
Municipal Securities Are Already Supporting Jefferies’ Results
Jefferies reported fixed-income net revenue of $199 million for its fiscal second quarter of 2026, representing a 12% increase from the same quarter a year earlier.
The company attributed the improvement primarily to strong performance in distressed credit, municipal securities and emerging markets. That disclosure makes the new appointments especially notable because Jefferies is adding senior talent to an area already contributing positively to its results. The figures are available in the company’s official second-quarter earnings release.
The expansion is consistent with the bank’s wider strategy of using targeted recruitment to gain market share from larger competitors. Jefferies operates as a full-service investment bank but remains smaller than Goldman Sachs, Morgan Stanley, JPMorgan Chase and Bank of America.
That size difference can become an advantage when experienced professionals believe they will receive greater responsibility, more flexibility or a clearer opportunity to build a business. A senior trader moving from a larger institution may obtain more influence over risk allocation, hiring, client coverage and the development of the trading platform.
Jefferies describes its fixed-income division as a platform that supports its wider investment-banking franchise through execution, market insight and liquidity. The municipal hires fit that model because stronger secondary-market capabilities can deepen relationships with both investors and public-sector borrowers.
Goldman and Morgan Stanley Still Have Major Muni Franchises
The departures do not mean that Goldman Sachs or Morgan Stanley is abandoning municipal finance. Both remain active across underwriting, sales, trading and investment management.
Goldman Sachs continues to publish detailed municipal market research and manages multiple tax-exempt fixed-income strategies. Its second-quarter 2026 review found that municipal yields rallied as strong investor demand and summer reinvestment flows absorbed substantial new issuance. The firm’s municipal market review also reported positive investment flows across credit-quality and duration categories through June.
Morgan Stanley similarly maintains a large municipal investment operation and describes its team as one of the deepest in the industry. Its platform includes strategies spanning different maturities, credit qualities and tax-exempt investment objectives.
Losing individual professionals may not materially weaken either institution. However, the appointments show that Jefferies can attract talent from firms traditionally associated with the upper tier of Wall Street fixed income.
What the Hiring Push Could Deliver
The immediate benefit will depend on whether the new team can bring additional client activity to Jefferies. Traders do not simply transfer a guaranteed revenue book when they change employers. Clients decide where to trade according to pricing, service, balance-sheet capacity, inventory and the quality of the complete platform.
DeMarco’s seniority may help Jefferies expand risk management and market-making across different municipal sectors. Bertoni can add trading and client knowledge developed at Goldman and earlier firms. The expected Morgan Stanley recruit could further strengthen distribution or execution, depending on the final role.
Success would likely appear through higher secondary trading volumes, stronger participation in new issues and improved connections between public finance bankers and institutional investors. It may also give Jefferies greater flexibility when markets become volatile and clients need dealers willing to provide liquidity.
The appointments arrive at a favourable moment. Municipal issuance is elevated, tax-exempt income remains attractive to many investors and Jefferies has already reported better revenue from the business.
The hiring of veterans from Goldman Sachs and Morgan Stanley therefore represents more than a collection of new job titles. It is a calculated attempt to convert a strong municipal market into lasting market share—and to show that Jefferies can compete directly with the largest Wall Street firms for both talent and clients.
