SAN FRANCISCO -- Wells Capital Management has made strategic changes in order to win new business and move the firm forward.
Last year was Wells Capital's first year away from its parent, Wells Fargo Bank. The time was spent developing the firm's independent character. Investment performance was average overall, and the firm didn't win a great deal of new business.
But things are in place for that to change, said Robert Bissell, president and chief investment officer. "For us, 1997 was a challenging year. We're old but we're new."
The active San Francisco-based money manager increased total assets about 12%, to $41 billion from $36 billion in February 1997. While two-thirds of total assets are invested in fixed-income strategies, most of the growth came from small-cap equity investments, Mr. Bissell said.
"Our desire now is to broaden our activities and offer the cutting-edge things of interest to potential clients," he said.
The firm is adding a global fixed-income product with a core-plus strategy anticipated for the future. It hired Graham Allen from Bradford and Marzec Inc. in Los Angeles to head that activity. Mr. Allen was Bradford's international portfolio manager; Mr. Allen's position at Bradford has been filled by Patrice Milton, former global portfolio manager at Fischer, Francis, Trees & Watts Inc., New York.
Daniel Kokoszka, Mr. Allen's assistant portfolio manager at Bradford, followed Mr. Allen to Wells, where he is the new global fixed-income portfolio manager.
Wells redesigned the sales team to go after larger clients. It hired a national marketing person, Thomas Harrison from Hotchkis & Wiley in Los Angeles, to visit consultants and boost recognition.
Wells Fargo Bank launched Wells Capital because the bank believes pension fund consultants prefer independent subsidiaries to bank-division investment firms. And winning the favor of the consultants can lead to increased business, Mr. Bissell said.
The Wells staff has been organized into teams, away from the hierarchical structure, Mr. Bissell said. The recent departure of fixed-income director Tamyra Thomas came at a time of shifting responsibilities, he said.
"We wanted to move away from the singular person at the top," Mr. Bissell said. "People become more entrepreneurial when they can drive a strategy and be responsible."
Jacqueline A. Flippin will head the core fixed-income group formerly led by Ms. Thomas; Ms. Flippin previously was with McMorgan & Co., San Francisco.
"The marketplace is interested in organizations that have real focus, and as a stand-alone you truly do," Mr. Bissell said. "All our marketing activities are for our institutional business."
Of the $41 billion in total assets, about $8 billion is from U.S. institutional tax-exempt clients. About $2.79 billion is from endowment and foundation clients, $5 billion is from corporate clients and $32 million is public fund money.
Wells Capital is a subadviser for $20 billion in Wells Fargo's Stagecoach mutual funds and also subadvises some parts of the bank's private banking and institutional trust divisions.
