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OppenheimerFunds strengthens risk management and investment organisation

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OppenheimerFunds has announced various changes intended to strengthen the investment manager’s business operations.

OppenheimerFunds has announced various changes intended to strengthen the investment manager’s business operations.

The steps announced by Oppenheimer chief executive officer Bill Glavin (pictured) include strengthening Oppenheimer’s investment organisation and elevating the risk management function.

The company is also planning changes in its sales and marketing functions, which will allow for a more streamlined approach to communications with its clients.

"OppenheimerFunds is committed to delivering investment excellence over the long-term," says Glavin. "Each of the changes announced today is part of Oppenheimer’s business plan to focus on Oppenheimer’s core mutual fund and closely-related businesses and will allow OppenheimerFunds to better meet the needs of our clients in today’s market and beyond."

To further deepen its investment management leadership, Oppenheimer is creating two new positions in the investments department: chief investment officer, equities and chief investment officer, fixed income, both of whom will report to Glavin. Kurt Wolfgruber, currently OppenheimerFunds’ chief investment officer, has decided to leave the firm on 30 April.

Chris Leavy will take on the role of chief investment officer, equities. Leavy had announced in the autumn his plans to leave the firm on 31 March, but, after helping shape the business plan for the company, he decided to stay. Art Steinmetz, currently director of fixed income investments will take on the new role of chief investment officer, fixed income.

The company has also named Joseph Welsh as head of a newly-formed high yield corporate debt team. In this capacity, he will serve as portfolio manager of the Oppenheimer Champion Income Fund, the high yield portion of Oppenheimer Strategic Income Fund and all related high yield strategies. He will continue as co-portfolio manager of Oppenheimer Senior Floating Rate Fund, a fund that invests in syndicated loans to below-investment grade companies.

"The creation of a high yield corporate debt team is a step we are taking to strengthen the Company’s taxable fixed income investment capabilities in light of what we have learned from recent market volatility," said Art Steinmetz, chief investment officer, fixed income. "Consolidating the management of below investment grade assets on a single, proven team is the right strategy moving forward and Joe’s extensive experience will serve us well."

Welsh joined OppenheimerFunds in January 1995 as a high yield bond analyst and became vice president and co-portfolio manager of Senior Floating Rate Fund in September 1999. Welsh has specialised in non-investment grade debt investing since 1991.

Krishna Memani has assumed portfolio manager responsibilities for Oppenheimer Core Bond Fund, Oppenheimer Limited-Term Government Fund and Oppenheimer US Government Trust Fund. He was hired last month by Oppenheimer as head of the investment grade fixed income team.

The company is also raising the profile of risk management and control across the organisation, giving Glavin direct access and support from the risk management, compliance and internal audit functions. Effective immediately, Geoff Craddock, head of risk management, and Mark Vandehey, head of compliance, will join Kristina Olson, head of internal audit, in reporting directly to Glavin.

"As a result of the unprecedented market volatility and dislocation in 2008, companies across the financial services industry are taking a close look at how to enhance their risk management and control functions," says Glavin. "The new reporting structure for these groups will enable me to have direct oversight of these important functions."

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