Capital Management

Legg Mason Capital Management's chief investment strategist, Michael J. Mauboussin, resigned as of Jan. 2, said Mary Athridge, Legg Mason Inc.'s spokeswoman. Mauboussin's resignation is not a surprise, and he's expected to announce his plans in the next couple of weeks, she said. Right now, Athridge said, he is focused on promoting his newest book, "The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing. " Before joining the Capital Management subsidiary of Baltimore-based Legg Mason in 2004, Mauboussin was the managing director and chief U.S. investment strategist at Credit Suisse.

Legg Mason Inc. has lost two key employees of its Legg Mason Capital Management, including portfolio manager Mary Chris Gay. Gay, manager of an overseas version of the subsidiary's well-known Value Trust fund, and Randy Befumo, head of research at Legg Mason Capital Management, left May 15 and are "pursuing other opportunities," said spokeswoman Mary Athridge. Sam Peters, manager of the Value Trust fund in the United States, last week replaced Gay as manager of the Value Fund that is modeled after the Value Trust.

JAMES D. HARDESTY knew he loved the money management business the day he started working in the mailroom at Alex. Brown Inc. as a 17-year-old high school student.His appetite was whetted as he delivered mail and overheard talk among brokers. He devoured the research reports he mimeographed, and he was gripped by the loud, frantic traders who sent him out for coffee."I was fascinated from the beginning," he recalls.Today, the 50-year-old Hardesty is still as charmed by stocks, bonds and money.

Legg Mason Inc. plans to lay off an undisclosed number of employees as it folds its once high-profile Legg Mason Capital Management unit in Baltimore into a much larger investment division based in New York. Capital Management rose to fame under star money manager Bill Miller, whose Legg Mason Value Trust fund made headlines year after year for beating its stock market benchmark. Though Capital Management's investment team will remain at Legg's headquarters in Harbor East, the merger is a symbolic loss for the city.

Legg Mason Inc. plans to lay off an undisclosed number of employees as it folds its once high-profile Legg Mason Capital Management unit in Baltimore into a much larger investment division based in New York. Capital Management rose to fame under star money manager Bill Miller, whose Legg Mason Value Trust fund made headlines year after year for beating its stock market benchmark. Though Capital Management's investment team will remain at Legg's headquarters in Harbor East, the merger is a symbolic loss for the city.

Alex. Brown Inc. announced yesterday that it has taken a small equity interest in a new investment management firm created by Richard C. Hackney Jr., who is leaving Alex. Brown to establish Hackney Capital Management L.P.Mr. Hackney, who was president of Alex. Brown's Flag Investors Emerging Growth Fund, is majority owner of his new firm.Five years ago, Baltimore-based Alex. Brown helped broker Nathan A. Chapman Jr. leave the firm and set up his own, now a successful minority-owned brokerage with offices in about a half-dozen cities.

First Union Corp. reported yesterday record income of $883 million in the second quarter, up 23 percent before merger-related and restructuring charges.The nation's sixth-largest banking company made 92 cents per diluted share in the second quarter, which ended June 30, up 24 percent from the 74 cents per diluted share in the same time year earlier.The results beat Wall Street analysts' estimates by 2 cents, said Zacks Investment Research, which tracks earnings predictions.After $634 million in merger-related charges in the second quarter, the Charlotte, N.C.-based company made $249 million, or 26 cents per diluted share, down from $682 million, or 70 cents a share.

Two companies that broker Nathan A. Chapman Jr. plans to merge to create a publicly traded Internet financial services firm restated 1999 earnings yesterday, giving both companies losses for the year. Chapman Holdings Inc., a Baltimore-based brokerage and investment banking firm, lost $442,000 last year as a result of an accounting change. The move reversed a $364,000 profit previously reported. Chapman Capital Management Holdings Inc., an investment advisory company, said it lost $853,000 last year, widening its previously reported loss of $582,000.

Baltimore County received a B+ in a national report card on government efficiency, the third-highest grade given in a study of the nation's 40 largest counties. The information, to be released today by the Maxwell School at Syracuse University and Governing magazine, graded counties in five areas: financial management, capital management, human resources, managing for results and information technology. Baltimore County exceeded the national average in all five areas, falling behind only Fairfax County, Va., and Maricopa County, Ariz.

On the heels of the worst stock-market slump since the Great Depression, Legg Mason Inc. reported yesterday a better-than expected fourth quarter to cap a record year, the payoff of its transformation from a regional brokerage house to asset manager. While its rivals have foundered, Legg reported, its profit for the three months that ended March 31 were up 5.6 percent, to $48.7 million, from the $46.1 million earned in the fourth quarter last year. Earnings per share on a fully diluted basis were 71 cents, up 6 percent, from 67 cents in the final fiscal quarter last year and 2 cents ahead of Wall Street estimates.

Legg Mason Capital Management's chief investment strategist, Michael J. Mauboussin, resigned as of Jan. 2, said Mary Athridge, Legg Mason Inc.'s spokeswoman. Mauboussin's resignation is not a surprise, and he's expected to announce his plans in the next couple of weeks, she said. Right now, Athridge said, he is focused on promoting his newest book, "The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing. " Before joining the Capital Management subsidiary of Baltimore-based Legg Mason in 2004, Mauboussin was the managing director and chief U.S. investment strategist at Credit Suisse.

Mall owner Simon Property Group said Thursday it would increase its ownership in Arundel Mills Mall and Arundel Mills Marketplace in Hanover as part of a $1.6 billion deal to acquire its joint venture partner's stake in 26 Mills malls and shopping centers nationwide. Simon has signed an agreement with Farallon Capital Management LLC to acquire Farallon's stake in properties owned by The Mills Limited Partnership. The purchase price includes the repayment of some of the Mills' debt.

Bruce Sherman, whose once-top-performing unit at Legg Mason Inc. was ravaged by losses on investments in Bear Stearns Inc. and several newspaper companies, is retiring at the end of the month. Sherman, 60, co-founded Private Capital Management, a money manager catering to wealthy investors that Legg bought in 2001 for nearly $1.4 billion. Sherman said in a brief interview yesterday that retirement was a difficult decision. "I sold the firm in 2001, and there was an inevitability of retirement at some point in time," Sherman said, noting March 31 was a logical time, since it is the end of Legg's fiscal year.

Legg Mason Inc. said yesterday that it will cut jobs at its Baltimore headquarters and money-management subsidiaries, starting with the dismissal today of about one-third of the employees at the division run by famed stock picker Bill Miller. Legg Mason Capital Management, which Miller oversees as chairman and chief investment officer, confirmed yesterday that it plans to cut 40 to 50 people from its work force of 147, with notices going out today. The Baltimore-based division, like its parent, is having a turbulent year.

Baltimore-based T. Rowe Price Group's plain vanilla approach to investing led it to a $162.2 million quarterly profit, while its flashier crosstown peer, Legg Mason Inc., reported a $31.3 million loss as its star fund managers continued to struggle in a bear market, the companies reported yesterday. Price's profit for the second quarter that ended June 30 matched the $162.2 million it earned in the year-earlier period despite a volatile market that left most major financial firms staggering.

It has been a rough stretch for those who have invested with Bruce S. Sherman, the co-founder of Private Capital Management. After years of stellar performance, his asset management firm has stumbled. Based in Naples, Fla., it was one of the big losers in the near-collapse of Bear Stearns Cos., with total losses estimated at several hundred million dollars. That debacle followed huge losses in newspaper company stocks, which Sherman abandoned by the end of 2007, according to public filings.

CHARLOTTE, N.C. -- Bank of America Corp., the biggest U.S. bank, said yesterday that it is combining money management units catering to wealthy people, institutions, and mutual fund investors into one group "to more effectively serve client needs and build our business."Michael Kenneally, now president of Bank of America Investment Management in St. Louis, is to oversee the money management functions for the new group.Holly Deem, the president of TradeStreet Investment Associates Inc. in Charlotte, is to head operations, and Robert Gordon, president of NationsBanc Advisors Inc. in Charlotte, is to direct marketing and product development.

Alex. Brown and Legg Mason recognizedNothing like a little recognition from one's peers. Alex. Brown Inc. and Legg Mason Inc. got some of that recently when Institutional Investor magazine's "Money Management Letter" listed the two Baltimore firms among the 30 fastest-growing broker/dealer affiliates, in terms of increase in assets managed.Alex. Brown's 1800 Capital Management topped the list with a whopping 373.1 percent growth in the year that ended June 30. Most of it came from the addition of the Alex.

BERLIN -- DaimlerChrysler AG insists it is keeping all options open for the future of the Chrysler Group. But judging by its tense annual meeting here yesterday, Daimler's marriage to Chrysler is already finished, except for the ink on the divorce papers. Trying to placate restive shareholders, DaimlerChrysler confirmed for the first time that it was in negotiations with a number of bidders about a deal for the troubled American unit, which lost $1.5 billion last year. "We are talking with some of the potential partners who have shown a clear interest," the chief executive, Dieter Zetsche, said.

WASHINGTON - A federal initiative to repay investors who lost money because of corporate wrongdoing and other misdeeds has amassed $2.6 billion in just two years and has played a role in almost 100 cases settled by federal regulators. Little of the cash has been returned to shareholders, but officials with the Securities and Exchange Commission maintain that the little-noticed effort is on track and will pay off big for investors who get hurt when fraud torpedoes a company's stock. "Knowing at the end of the line that victims are going to receive tangible compensation - it's meaningful to us, and it's certainly meaningful for people who are finally getting something back that they've lost," said Amy J. Greer, an SEC senior trial counsel who recently administered a $2 million payback for investors of Nevis Capital Management.