Plus, news on the likely Putnam sale, Evergreen brokerage fines, and more.
American Century is losing a key executive and investor. Harold Bradley, chief investment officer of U.S. growth equity mid-cap and small-cap sectors, is leaving the firm Jan. 31. Bradley also served as portfolio manager of American Century New Opportunities
We think this departure, the most recent of several over the past year, is a real blow to the firm because Bradley was a key player in the development of the quantitative models that drive the small- and mid-growth strategies. While there are others at American Century who will be able to continue this work, Bradley's loss will be felt. Additionally, Bradley was a forceful advocate for investment industry reforms, which included Congressional testimony critical of fund companies' use of soft dollars.
Canadian Firm to Buy Putnam
Marsh & McLennan Companies
The price Putnam fetched was closer to the higher end of the expected range. That is good news for Marsh and underscores Power's interest in entering the U.S. mutual fund marketplace. Power already is a large player in the Canadian mutual fund market through its IGM Financial subsidiary, but Putman's roughly $190 billion in assets under management (roughly $94 billion of which is in its retail mutual fund business) would immediately place Power among the top dozen largest U.S. mutual fund companies.
Should the sale ultimately go through, the uncertainty that has surrounded the Putnam funds for the past several months would come to an end, but that wouldn't necessarily be the end of Putman's troubles. In recent years the fund company has seen several billion dollars in outflows from its fund business, due both to underperforming funds and scandal, and these troubles will not easily be remedied. Overall, we think Putnam's turnaround remains a work in progress, and in particular, we'd like to see greater stability in the manager ranks and evidence of improved analyst research before we take a more favorable view of the shop as a whole. Power Corp. could have an impact here, so we'll be watching closely.
Evergreen Find Some Green
Evergreen Investment Services, the affiliated distributor of the Evergreen family of funds, has been fined $4.2 million by the NASD. Evergreen Funds distributor directed portfolio trades from Evergreen funds toward Wachovia-affiliated brokers who had sold a certain number of Evergreen fund shares, creating a conflict of interest and potentially harming Evergreen fund shareholders by discouraging the funds from seeking the lowest possible trading commissions. As is typical in settlements like this, Evergreen neither admitted nor denied guilt.
Thornburg Fixed-Income Veteran Retires
Thornburg Investment Management has announced the retirement of veteran bond manager Steve Bohlin, who worked at the firm for more than 22 years. Jason Brady will succeed Bohlin on Thornburg Limited-Term Income
SSgA Fund Adds Comanager
SSgA Yield Plus