BIAM jobs at risk as State Street ties up €57m deal
STATE Street is hoping to more than double the size of Bank of Ireland Asset Management's business after agreeing to pay €57m for the Dublin-based company.
But a senior executive at State Street yesterday refused to rule out cutbacks in BIAM's 120-strong workforce, saying only that he hoped any impact would be "minimal".
The comment came after the long-awaited deal between State Street and BIAM was finally announced yesterday morning.
BIAM had been on the market since April, when the European Commission ordered Bank of Ireland to sell the division as a condition of its state aid package.
At its peak, BIAM had €56bn worth of assets under management, but that portfolio has since dipped to €26bn. Asked if BIAM's new owners would restore the asset manager to its peak figures, State Street senior executive Greg Ehret replied: "Yes, that's the intention."
Mr Ehret, who heads up State Street Global Advisers' operations in Europe, the Middle East and Asia, was coy on how long it would take BIAM to reach that goal, saying it was "impossible" to predict.
He stressed, however, that there were considerable opportunities for BIAM, both from the "state of transition" in the Irish pension market and from leveraging the larger State Street offering.
Asked if it was hard to convince State Street's board to invest in Ireland given all the country's challenges, Mr Ehret said "No, not when you have a team like we have in BIAM".
He added that he was "confident" of retaining "key talent" but declined to be drawn on tie-in deals.
Announcing the deal, Bank of Ireland confirmed that BIAM's acting chief Chris Johns would be migrating across to State Street, as State Street Global Advisers' chief investment officer for fundamental equities.
Despite stressing the growth prospects for BIAM, Mr Ehret said it was "too early to tell" what the impact would be for staff.
"We're still working through integration plans," he said, adding that he hoped any impact would be "minimal".
State Street is still scoping out new premises for BIAM, and Mr Ehret confirmed that the asset manager would not be going to the existing State Street hub in Sir John Rogerson's Quay.
State Street already employs 2,000 in Ireland, as part of its passive investment management operations.
The BIAM acquisition marks the first move into active investment management in Ireland.