Alex Friedman has stepped down as chief executive of GAM effective immediately, with the group saying its next stage of evolution would be best served by new leadership.
The latest development in what has been a tough few months for the Swiss-based global asset manager, Friedman agreed to step down yesterday with GAM board director and former Henderson Global Investors chief investment officer David Jacob replacing him on an interim basis.
GAM said Jacob's immediate priority will be to ensure the steps to drive the group's strategy and to support profitability are actioned as soon as possible.
In July GAM announced it had suspended investment director Tim Haywood after an internal investigation identified issues with risk management processes and record keeping. Haywood oversaw the group's suite of absolute return bond funds.
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The suspension triggered an overwhelming number of redemptions and GAM was forced to halt trading and liquidate the funds which held about $10 billion in total. The first payments were made in early September.
Shortly after, the group's head of compliance Natalie Baylis departed following just four months in the role.
In announcing Friedman's departure, GAM chair Hugh Scott-Barrett said the group is facing some important decisions as it seeks to position the business for future growth.
"Alex and the board of directors jointly agreed that new leadership will better enable us to take the action necessary to support profitability and drive forward the group's strategy," he said.
"David Jacob is the ideal person to lead the company, given both his detailed understanding of the group and his successful track record leading asset management businesses."
He added that Friedman had the full support of the board in suspending Haywood, a move that triggered a significant drop in the asset manager's share price and decline in earnings on the back of the liquidation.
"Alex has ably led the business during a time of unprecedented challenges for the active asset management and hedge funds industry ... During his tenure as chief executive he has driven a significant program of change that has made us a more modern, diversified and cost-effective business," Scott-Barrett said.
Jacob said: "Despite the setback suffered by the business this year, we are fortunate to have a board with a wide and relevant range of experience as well as the strong management team that Alex assembled. I look forward to working with both teams and ensuring that we keep our focus firmly on continuing to meet our clients' expectations."
The search for a permanent replacement is underway.