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Friday, November 21, 2008|
American Funds Shields PMs, Sales From Cuts
It looks like American Funds' U.S. portfolio management and sales staff won't be facing layoffs. A Capital Group spokesman told MFWire that the fund firm from the City of Angels won't be cutting investment or sales jobs, despite making some institutional reductions overseas.
"We are looking at all expenses, but we're continuing to increase investment management and analyst staff at a rate of six to eight percent per year," Cap Group spokesman Chuck Freadhoff said. "We have no plans to reduce our wholesaling force."
Capital Group is making cuts, but they're in the firm's Global Institutional Group (see MFWire, November 21, 2008). Freadhoff revealed that the firm sent a memo to all its employees across the globe at the end of October, a memo that announced the elimination of 60 positions in GIG's Geneva and London offices (out of a total of 862 positions in Europe). The reason, Freadhoff said, comes from the shift away from pensions, on which GIG focuses, and towards defined contribution plans like 401(k)s.
"GIG assets declined about 46 percent over the last three years [to $158 billion on September 30]," Freadhoff said. "Given that decline, we don't require the support we have ... We're continuing to look at expenses."
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