April 23, 2014 8:10 PM ET

Capital Markets

Company Overview of Western Asset Management Company

Company Overview

Western Asset Management Company is a privately owned investment manager. The firm provides its services to banking or thrift institutions, investment companies, pooled investment vehicles, charitable organizations, corporations, and state or municipal government entities. It manages separate client-focused fixed income portfolios. The firm also launches and manages equity, fixed income, and balanced mutual funds for its clients. It invests in the fixed income and alternative investments markets across the globe. It employs fundamental analysis with a bottom-up stock picking approach to create its portfolios. The firm obtains external research to complement its in-house research. It operates...

385 East Colorado Boulevard

Pasadena, CA 91101

United States

Founded in 1971

Phone:

626-844-9400

Fax:

626-844-9450

Key Executives for Western Asset Management Company

Chief Executive Officer
Age: 52
Chief Financial Officer
Age: 52
Director of Risk Management and Operations
Head of Developing Markets and Portfolio Manager
Head of Credit and Portfolio Manager
Compensation as of Fiscal Year 2013.

Western Asset Management Company Key Developments

Western Asset Management Announces Promotion of Chia-Liang Lian to Co-Head of Emerging Markets Debt

Western Asset Management Company announced the promotion of Chia-Liang (CL) Lian to Co-Head of the Emerging Markets Debt Team, reporting to S. Kenneth Leech, Co-Chief Investment Officer of Western Asset. The appointment is effective in April of 2014. Building upon Mr. Lian's successful effort in expanding the Asia ex-Japan investment team, the appointment will create a two-year succession plan for the emerging markets debt investment effort. Mr. Lian will serve as Co-Head alongside Keith Gardner, who intends to retire in April of 2016, after nearly 22 years with Western Asset. The company also promoted Desmond Soon, one of the Singapore investment team members, to Co-Head of Investment Management, Asia, also effective April 2014.

Wamco Presents at JPMorgan 5th Annual Emerging Markets Corporate Conference, Feb-26-2014 07:45 AM

Wamco Presents at JPMorgan 5th Annual Emerging Markets Corporate Conference, Feb-26-2014 07:45 AM. Venue: Ritz-Carlton, One Lincoln Road, Miami Beach, Florida, United States. Speakers: Robert Abad.

SEC Charges Western Asset Management Company with Defrauding Clients

The Securities and Exchange Commission announced sanctions against Western Asset Management Company for concealing investor losses that resulted from a coding error and engaging in cross trading that favored some clients over others. The company agreed to pay more than $21 million to settle the SECs charges as well as a related matter announced by the U.S. Department of Labor. Western Asset serves as an investment manager primarily to institutional clients, many of which are ERISA plans. Western Asset breached its fiduciary duty by failing to disclose and promptly correct a coding error that caused the improper allocation of a restricted private investment to the accounts of nearly 100 ERISA clients. The private investment that was off-limits to ERISA plans had plummeted in value by the time the coding error was discovered, and Western Asset had an obligation to reimburse clients for such losses under the terms of its error correction policy. Instead, Western Asset failed to notify its ERISA clients until nearly two years later, long after the firm had liquidated the prohibited securities out of those client accounts. When the coding error was discovered, Western Asset put its own interests above its clients and avoided telling investors what had caused losses in their accounts, said Michele Wein Layne, director of the SECs Los Angeles Regional Office. By concealing the error, Western Asset avoided reimbursing clients for their losses. In a separate order involving a different set of client accounts, the SEC finds that Western Asset engaged in a type of cross trading that was illegal. Cross trading is the practice of moving a security from one client account to another without exposing the transaction to the market, and when done appropriately it can benefit both clients by avoiding market and execution costs. However, cross trading also can pose substantial risks to clients due to the advisers inherent conflict of interest in obtaining best execution for both the buying and the selling client. The SECs order finds that during the financial crisis, Western Asset was required to sell mortgage-backed securities and similar assets into a sharply declining market as registered investment companies and other clients sought account liquidations or were no longer eligible to hold these securities after rating agency downgrades. Instead of selling the securities at prices that Western Asset believed did not represent their long-term value, it arranged for certain broker-dealers to purchase the securities from the Western Asset selling clients and sell the same security back to different Western Asset clients with greater risk tolerance in prearranged sale-and-repurchase cross trades. Because Western Asset arranged to cross these securities at the bid price rather than a price representing an average between the bid and the ask price, the firm improperly allocated the full benefit of the market savings on the trades to buying clients and denied the selling clients approximately $6.2 million in savings. The SECs orders find that Western Asset violated Sections 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-7, and aided and abetted and caused violations of Sections 17(a)(1) and 17(a)(2) of the Investment Company Act of 1940. Without admitting or denying the findings, the firm agreed to be censured and must cease and desist from committing or causing any further such violations. For the disclosure violations related to the coding error, Western Asset must distribute more than $10 million to harmed clients and pay a $1 million penalty in the SEC settlement and a $1 million penalty in the Labor Department settlement. For the cross trading violations, Western Asset must distribute more than $7.4 million to harmed clients and pay a $1 million penalty in the SEC settlement and a $607,717 penalty in the Labor Department settlement. An independent compliance consultant must be retained to internally address both sets of violations.

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Recent Private Companies Transactions

Type
Date
Target
Private Placement
April 3, 2014
Western Asset Mortgage Capital Corporation
 

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