3 Min Read
* Firm trims underperforming areas, sources say
* One 22-year veteran retires
By Jessica Toonkel
Dec 1 (Reuters) -A number of investment management executives at BlackRock Inc. have left the $3.345 trillion asset management firm over the past few weeks.
Many of the departures are part of an effort to shed weight in underperforming areas, sources familiar with the situation said.
Steve Switzky, managing director of the fixed income group, left BlackRock in early November. He had been with BlackRock since 1994, according to Morningstar. A call to Switzky's home was not returned.
Separately, Richard Shea and Chris Milner, president and managing director of BlackRock's real estate debt company, Anthracite Capital, will leave the firm today.
Their departures, first reported by Debtwire, come 18 months after Anthracite filed for bankruptcy. In April, in a bid to revive the business, BlackRock hired Jack Chandler, a global chief investment officer and executive chairman for Asia for LaSalle Investment Management, as its new global head of real estate.
BlackRock said in an internal e-mail on Tuesday that Mike Lustig, a 20-year veteran of the firm, would retire. Lustig, a managing director and part of the BlackRock's financial modeling portfolio analytics group, had accepted a teaching job at Columbia University's business school, according to the e-mail from BlackRock Inc. President Robert Kapito, which was obtained by Reuters.
Lustig was not available for comment.
BlackRock recently also made changes in its retail marketing division, which targets financial advisers. On Wednesday, Reuters reported that BlackRock had trimmed jobs in that division as part of firm-wide cost-cutting measures spurred by challenging market conditions.
"In particular, we are focusing resources on key priorities, while identifying ways to streamline processes, simplify platforms, and reduce expenses," BlackRock spokeswoman Bobbie Collins wrote in an e-mailed statement on Wednesday. "This has included shifting personnel in some instances, and in some cases, eliminating positions consistent with client needs."
It's not uncommon to see year-end departures at investment management companies as some executives retire, while others are asked to leave due to underperformance, said Joseph McCabe, vice chairman at recruiting firm CTPartners.
And BlackRock CEO Larry Fink is known for trimming underperformers. Jay Alexander, who ran the firm's Granite Fund for institutional real estate investors, departed this summer after his fund lost more than 50 percent of its value in two years.
In 2008, the firm cut a half dozen members of a lagging equity growth unit amid widespread cost cutting. A few years earlier, Fink let go several stock-picking teams with market-lagging records acquired in a deal for MetLife's State Street Research & Management division. (Additional reporting by Aaron Pressman in Boston. Editing by Jennifer Merritt and Bernadette Baum in New York)