Walsh's presence is sure to be missed, but he leaves behind a very capable team.
Steve Walsh, Western Asset's chief investment officer, announced on Thursday, March 21 that he plans to retire on March 31, 2014, after more than two decades at the firm.
Walsh has managed portfolios for the firm since 1990, and he served as deputy CIO from 1998 to 2008. He stepped in as the firm's sole CIO in August 2008 when Western's longtime CIO, Ken Leech, stepped back from his day-to-day duties for medical reasons. Leech, who received a clean bill of health in mid-2009, will return to the CIO post upon Walsh's retirement. Walsh and Leech have worked together for 22 years, and during Leech's tenure as CIO from 1998 to 2008, he and his team were named Morningstar Fixed-Income Fund Manager of the Year (2004) and received nominations for the award in 2003 and 2006.
Since Leech returned to the firm on a day-to-day basis in 2009, he has served as chairman of the firm's global strategy committee and as a key member of the U.S. broad market committee, and he continued to play an integral part in the firm's investment strategy during that time. He has also been responsible for managing the firm's global portfolios.
Walsh and Leech will serve as co-CIOs over the next 12 months during the transition period. As the transition year progresses, Leech will gradually expand his responsibilities to cover all client portfolios, and effective April 1, 2014, he will become the sole CIO of Western. The firm has no plans to name a co-CIO or deputy CIO at that time. Walsh's presence is sure to be missed, but Leech's return to the post he effectively held for more than a decade should provide continuity and help facilitate a smooth transition. And while Walsh is a named portfolio manager on all Western funds, the firm has long used a team-managed approach and has a deep and experienced staff of portfolio managers, sector heads and credit analysts. Key investment personnel, including risk-management staff, joined the firm after some of its strategies struggled during the global financial crisis, putting it on steadier footing in more recent years. All told, Walsh leaves a very capable team behind and the transition is expected to be a smooth one.