PITTSBURGH - Westinghouse Electric Corp.'s restructuring last month effectively eliminated the $3.8 billion defined benefit plans' sizable in-house investment management operation.
The staff was pared from four people to one - Julie Forsythe - who was promoted from within the pension group at Westinghouse. Thomas Scannell, a 31-year veteran of the company who spent the last 10 years as head of pension investments, took an early retirement package. He then joined Advanced Investment Management, Pittsburgh, as a marketing consultant, a new position.
Joanne Welsh and John Moore, who managed Westinghouse's in-house assets out of the New York office of a company subsidiary, also left the company.
Before Mr. Scannell retired, he oversaw a broad expansion of the investment options offered by the company's $3.2 billion 401(k) plan.
As for defined benefit assets, Mr. Scannell said Westinghouse managed 20% to 25% of the pension fund and $500 million in other defined benefit plans in-house, in stock and bond index funds. Those assets have been shifted to new and existing outside managers he declined to identify.
No one has been hired to assume the former duties of Ms. Forsythe, the new director of investments, according to Roy Morrow, a company spokesman.
Westinghouse has been restructuring its work force for two years.
In addition to outsourcing the internally managed assets, Westinghouse added new mutual fund options to its 401(k) plan last year.
In late 1993, it hired Bankers Trust as a record keeper. Subsequently, it added new investment options: the BT Life Cycle funds; the JPM Institutional Diversified Fund; the JPM Institutional International Equity Fund; the Janus Fund; Twentieth Century Ultra Investors; and Fidelity Growth & Income. It retained its other options: a stable-value fund run by a number of outside managers; Westinghouse stock; and a fund managed by Bankers Trust that mirrors the Standard & Poor's 500 Stock Index.
Thomas Allen, president of Advanced Investment, said: "We've been working with Tom for many years. We're real happy to have picked him up." Mr. Scannell will use his contacts in the industry to "help us explain some of our derivatives strategies more directly."
Said Mr. Scannell: "I'm only 53 years old. I am fortunate to be able to stay in the investment business and use my experience in the investment management area."
Westinghouse was one of the first clients to use Advanced Investment's enhanced index fund and it remains a client of the firm. Mr. Scannell's "faith in us has been rewarded over the years," as the strategy has beaten the S&P 500 during many periods, Mr. Allen said.
Mr. Scannell will now market existing products and help develop new ones for the firm, which runs $3.3 billion.