Archeus Capital, a US hedge fund manager with $3bn (€2.4bn) under management at the start of last year, has closed down its London operation.

Thierry Bollier, the partner in charge of operations, has joined WestLB. The London office was responsible for the firm's collateralised debt obligation correlation trading, investing in tranches of CDOs. Archeus was one of the firms that lost money on this strategy in April and May last year after ratings agencies downgraded bonds issued by US carmakers GM and Ford. The firm's funds lost 3% in April last year and another 3% the following month, according to an investor in the firm's funds. It decided to liquidate its CDO correlation trading book, a process it completed this year. The investor said the funds had been recovering from the losses, with one up 18% during the last 15 months and the other up more than 3% in the past 12 months, although it has lost 1.9% since the start of the year. However, the firm has suffered from client redemptions, which have taken its total assets under management down to $700m. Archeus declined to comment.