Mackenzie Financial Corp.'s key fixed-income manager Dan Bastasic has jumped ship to join rival IA Clarington Investments Inc.
His departure follows on the heels of another manager, Suzann Pennington, who recently left Mackenzie, a unit of IGM Financial Inc., to join Canadian Imperial Bank of Commerce. Within the past year, fixed-income manager Chris Kresic left to join Jarislowsky Fraser Ltd., while Jim Thompson, formerly team lead for the firm's Cundill funds, also left the mutual fund company.
The turnover at Mackenzie raises eyebrows, and "prompts a much closer monitoring of the firm," suggested Dan Hallett, fund analyst and director of asset management at HighView Financial Group. "Sometimes, turnover is necessary to move a firm to a better place. Other times, it's a sign of trouble."
Mr. Bastasic, co-head of Mackenzie's Sentinel fixed-income team, was overseeing $2.8-billion in assets. Among his duties, he had been lead manager for the Mackenzie Sentinel Corporate Bond and Mackenzie Sentinel North American Bond funds. He also ran Mackenzie Sentinel Registered Strategic Income Fund, which won a 2010 Lipper Award for one-year performance in the Canadian neutral balanced category. "His departure is a significant loss," Mr. Hallett said.
Mr. Bastasic and Mr. Kresic anchored Mackenzie's corporate and high-yield offerings for about a decade, and when Mr. Kresic left last year, "it was a blow to the team but Mr. Bastasic remained in place," Mr. Hallett said. "There are certainly enough bodies there [to take over]but the question is whether they still have sufficient skill left to continue doing good credit research."
Mackenzie has appointed U.S.-based Putnam Investments, an affiliated company which was bought by Great-Westco Inc. in 2007, to take over from Mr. Bastasic on most of the mandates. Both IGM and Great-West Lifeco are controlled by Montreal-based Power Financial Group Corp. "The [Putnam]team has an enormous breadth of expertise, particularly in high-yield credit," Charles Sims, chief executive officer of Mackenzie, said in a statement.
IA Clarington president David Scandiffio said that Mr. Bastasic will work at Mackenzie for a few more weeks. "We expect that he will start with us later in June," he said.
"We made it known in the marketplace that we were looking for equity-income managers, and it was an opportunity that seemed to fit and work well with him," said Mr. Scandiffio, who runs the mutual fund unit of Industrial Alliance Insurance and Financial Services Inc.
Mr. Bastasic will have the opportunity to head up a new investment division within IA Clarington so "it is really an opportunity to be employee No. 1 to head up this team," he said. "We see tremendous opportunities in the income and income-balanced categories [of funds]"
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