A few weeks into his tenure as head of asset manager GAM, David Jacob is wielding the axe. The cuts will affect some of his best-paid professionals.
The days before year-end arguably are the worst time for lay-offs – but in the case of the struggling asset manager GAM, staff at least have had ample warning of things that were in store. David Jacob, who succeeded Alexander Friedman as CEO of the Zurich-based firm, moved in last month with a brief to steady the ship.
His cost cuts will see 18 investment managers go, according to a report by «AWP» news agency. Fourteen have their desks in Zurich and four are based in London, according to the report. Releasing investment managers will significantly reduce operating costs. A GAM spokesman told «AWP» that the work was in progress.
Outflow of Assets
The asset manager started tumbling after it suspended star fund manager Tim Haywood in the summer. The sanction followed a report from a whistleblower that also prompted an internal investigation. The share price of GAM nosedived – the shares are down more than 70 percent in the year-to-date.
The news prompted clients to withdraw assets and the funds that Haywood had managed now have almost been liquidated. The problems finally caused Friedman to go and Jacob is now attempting to stop the rot.
