The TCW Group is a Los Angeles-based asset management with roughly
about 1,000 employees. From its offices in L.A., New York
City and Houston, the firm offers products in all four major asset
classes, U.S. equities, U.S. fixed income, international and
alternative strategies, to corporations, retirement funds,
financial services companies, endowments, foundations and wealthy
retail investors. Among the firm's flagship products are
concentrated core equities, mortgage-backed securities and
mezzanine investing. As of June 30, 2009, TCW had $103.3
billion in assets under management. Its parent company,
Société Générale Asset Management, currently has approximately $262
billion of assets under management.
In March 2008, for the fifth year in a row, the TCW Total Return
Bond Fund was the top-ranked fund in the Standard &
Poor's/BusinessWeek Annual Excellence in Fund Management
Awards. One of 24 winners chosen from a field of thousands,
TCW's fund is the only fixed-income mutual fund to win the award
every year since S&P and BusinessWeek started handing
out the honors in 2003. In August 2009, the company was
named, for the second consecutive year, to Los Angeles Business
Journal's list of Best Places to Work in Los Angeles.
In TCW we trust
Robert Day founded the firm in 1971 in Los Angeles, Calif., under
the moniker Trust Company of the West. In its first year of
business, with $16 million in assets in its pockets, TCW became the
third independent trust company in the State of California.
The firm's 1974 merger with Shareholders Asset Management Company
gave TCW the surge it needed. By the end of 1975, assets
under management had grown to $568 million, and the firm had 57
total clients. TCW went bicoastal in 1979, opening up a New
York office on Park Avenue. The next year, the firm's client
roster topped 100, and assets were at $3.2 billion. TCW's San
Francisco office opened in 1986, and in 1988, the firm established
its first offshore fund. Two years later, TCW acquired DBL
Americas Development Inc., now known as TCW Worldwide
Opportunities, in its first emerging markets venture. In
1993, TCW made another important acquisition, Dillon Read Intl.
Asset Management, and opened offices in London and Hong Kong.
The following year, the firm had approximately 1,000 clients.
It wasn't until 1999 that the firm recorded its biggest milestone
to date when assets under management grew by 34 percent in one year
to $71 billion, equaling the growth in the entire first 17 years of
the firm. This prompted French banking giant Société Générale
(SocGen) to acquire a majority interest in TCW in 2001.
TCW recently has been feeling some heat because of problems
happening within its parent company, SocGen, specifically a January
2008 incident in which a rogue trader cost the firm billions of
dollars in losses. Pensions & Investments
reported in February 2008 that "huge trading losses, billion-dollar
structured-debt write-downs, faulty control systems, allegations of
insider trading, and talk of takeover at the Paris-based bank have
cast a cloud over the Los Angeles money manager." The
publication also said TCW has been keeping close contact with its
important clients to prevent them from running scared from SocGen's
problems. TCW assured its investors that they had nothing to
worry about. A spokesperson for TCW told Pensions that "TCW
is in no way involved in any of the fraud due to rogue
trading. TCW is an autonomously managed, indirect subsidiary
of SocGen. We use separate risk management, compliance,
trading and back-office systems and controls."
Still, SocGen's woes caused the financial community to label it a
takeover target, which raises questions about TCW's future.
According to an analyst with Atlanta-based Watson Wyatt Worldwide,
"It all depends on who the new parent might be: what is their
experience with the asset management industry; what else do they
have in that area? A lot of things come into play."