T. Rowe Price fires 55 workers

Most are phone reps in Owings Mills

13 in Fla., Colo.

April 25, 2001|By Bill Atkinson | Bill Atkinson,SUN STAFF

T. Rowe Price Group Inc., whose funds have struggled amid weaker stock prices, said yesterday that it has eliminated 55 employees, most of whom work at its Owings Mills campus.

The employees were notified yesterday and dismissed immediately, said Brian Lewbart, a spokesman for the Baltimore-based mutual fund company.

He said the company provided severance packages and will assist the former employees in finding new jobs with the aid of an outplacement service.

Most of the employees worked in Price's call centers as telephone representatives, where they answered customers' questions about the mutual funds, opened and closed accounts and processed transactions.

Lewbart said 13 employees who were cut worked in T. Rowe Price offices in Tampa, Fla., and Colorado. No fund managers or analysts were dismissed, he said.

"The call volumes ... are down. It is a reflection of the market environment," Lewbart said. "This is part of a total companywide effort to reduce our expenses in 2001."

Price has about 4,000 employees in domestic and overseas offices, with the bulk - 3,200 - in Baltimore and Owings Mills.

After riding a decade-long stock market boom, mutual fund companies are being squeezed by falling stock prices and investors pulling money out of some of their stock funds.

Denver-based Janus Capital Corp., which operates a number of aggressive mutual funds and was one of the hottest companies in the business, fired 546 employees, or 25 percent of its work force, last week. That followed terminations of 468 employees in February.

Putnam Investments, a Boston-based mutual fund company, fired 256 employees about two weeks ago, representing 4 percent of its staff. It also cut a number of veteran fund managers.

Price's move comes after its profit slipped 34 percent in the first quarter ended March 31 to $49.3 million, or 38 cents per diluted share, from $75 million, or 58 cents per diluted share, in the corresponding period a year earlier.

Total assets that Price manages for individuals and institutions declined to $148.7 billion in the first quarter, down 19.7 percent from $185.2 billion a year earlier.

George A. Roche, Price's chairman and president, said at the company's annual meeting earlier this month that the company was "closely reviewing" its expenses.

On Monday, after the company released its earnings, James S. Riepe, vice chairman at Price, reiterated Roche's message, but noted that expense cuts would "include certainly some personnel."

"I think their action is consistent with actions that we have seen at other large asset managers," said John A. Hall, an analyst at Prudential Securities Inc. in New York "It is a difficult time to be a publicly traded asset manager when equity markets are going down."

Price shares fell 36 cents yesterday to $34.40.

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