GAM Suffers Record Decline After Scandal Leads to Massive Loss
- Firm to eliminate about 10% of jobs next year in restructuring
- Assets under management fell by 7 billion francs in two months
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GAM Holding AG’s shares fell a record 31 percent after the firm signaled it’s struggling to contain outflows prompted by a scandal over a star money manager and forecast a record loss.
The Swiss investment company said it will post a shortfall of 925 million francs ($931 million) for the year after massive outflows forced it to write down the value of its business. The loss erases eight years of earnings since GAM went public. With assets and fees lower for the foreseeable future, the group is cutting 10 percent of jobs.