Lombardia Capital Partners, one of the oldest minority-owned money managers in the U.S. is out of business after 28 years after firm officials were unable to stop a tide of outflows.
"A confluence of events" at the Chicago-based firm, including the March move of the firm's international value equity team to American Century Investments and poor performance in Lombardia's flagship small-cap value equity strategy, led to the shutdown, said co-CEO Vincent Williams in an interview Friday.
Mr. Williams said the firm was down to around $1 billion in assets under management, from more than $2 billion two years earlier, when the decision was made to close the firm in April, and it "became clear that more assets would be going out the door."
Mr. Williams said firm officials wrapped up the transfer of clients records last month with the last trades occurring in May.
The continuing loss of assets was just too much for the firm to remain profitable, Mr. Williams said.
While the three-person international value equity team did not take the $454 million it managed at Lombardia to American Century, Mr. Williams said Lombardia was forced to return the money to clients because it did not have the capabilities to manage the money after the team left.
Mr. Williams said client withdraws began in large scale after the death of George Castro, firm co-founder and executive chairman, in March 2015. Mr. Castro also served as a portfolio manager for several of the firm's equity strategies.
"George was the heart and soul of the firm," said Mr. Williams. "With small firms, when you lose that kind of luminary, it creates a vacuum."
Mr. Williams said the firm's other founder, Fernando Inzunza, remained as chairman of the board until the firm closed.