One year in, the folks at a Gotham fund firm's new high yield muni bond investing team are approaching $5.4 billion in AUM in their two mutual funds, and they're making another addition to their team.

Mehdi Asif Mahmud First Eagle Investment Management, LLC President, CEO

As December 31, 2024, the First Eagle Short Duration High Yield Municipal Fund had grown to $361.1 million in AUM, while the First Eagle High Yield Municipal Fund had grown to $5.0005 billion (up from $1 billion last spring and from $2 billion last summer). Earlier this month, Frank Riccio, head of U.S. wealth solutions at First Eagle Investments [profile], highlighted the first-year success of the New York City-based fund firm's high yield municipal credit business.

John Miller, head and chief investment officer of First Eagle's high yield muni credit team (and PM of both of the aforementioned high yield muni bond funds), and Carl Katerndahl, chief operating officer of that team, also highlighted the recent addition of San Juan Capistrano, California-based David Blair to the team as managing director and head of municipal core SMA business. Blair is a 17-year Nuveen veteran.

The First Eagle High Yield Municipal Fund's inception date was November 19, 2007, when it started out as a different fund, but it transformed and rebranded into its current version on December 27, 2023, and Miller joined First Eagle and took over that fund on January 2, 2024. The First Eagle Short Duration High Yield Municipal Fund launched on that same day, January 2 of last year.

Miller describes 2024 as "a transformational year" in which his team "laid a solid foundation with the potential to deliver continued success."

"Our commitment remains focused on delivering strong returns and steady income for investors through active credit selection," Miller states.

Katerndahl describes the hiring of Blair as a boost to the team's "capabilities in the investment grade space."

"It also positions us to better address the growing demand for innovative municipal strategies," Katerndahl states.

"The High Yield Municipal Fund's success is a direct result of our strategic partnerships with key distribution platforms that have positioned us to meet the growing demand from financial advisors. By offering long- and short-duration strategies, the team provides investors access to tax-exempt income at different parts of the municipal yield curve," Riccio states. "As more investors seek tax-efficient income solutions, we're excited to continue expanding access to our high yield municipal strategy across important distribution channels."

First Eagle Investment Management, LLC serves as investment manager to both of the high yield muni bond team's mutual funds. FEF Distributors, LLC serves as the funds' distributor.

The First Eagle High Yield Municipal Fund comes in four flavors: A shares (FEHAX) with a maximum up-front load of 250 basis points, a maximum deferred load of 100bps, and a 125bps expense ratio; C shares (FEHCX) with a maximum 100bps deferred load and a 200bps expense ratio; I shares (FEHIX) with a 100bps expense ratio; and R6 shares (FEHRX) with a 100bps expense ratio. All of those expense ratios bake in a 28bps fee waiver promised through February 28, 2025 (i.e. the end of next month).

The First Eagle Short Duration High Yield Municipal Fund comes in three flavors: A shares (FDUAX) with a maximum up-front load of 250bps, a maximum deferred load of 100bps, and a 97bps expense ratio; I shares (FDUIX) with a 72bps expense ratio; and R6 shares (FDURX) with a 72bps expense ratio. All of those expense ratios bake in a 38bps fee waiver promised through February 28.

The two high yield muni bond funds are both series of First Eagle Funds. Their other service providers include: JPMorgan Chase Bank, N.A. as custodian; PricewaterhouseCoopers LLP as independent accounting firm; and SS&C GIDS, Inc. as transfer agent.

Blair rejoined Nuveen in 2017 after more than 11 years with Pimco and an earlier Nuveen stint of more than nine years. He is an alumnus of the University of Chicago and of UC Santa Barbara.

Editor's Note: A prior version of this story gave incorrect information regarding David Blair's portfolio management duties at First Eagle. 

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