Simon Shields to replace Paul Fiani at UBS

The head of Australian equities at Colonial First State Global Asset Management (CFS GAM), Simon Shields, will leave the manager once his contract expires on June 30, 2007, and replace Paul Fiani in the equivalent spot at UBS Global Asset Management from July 1.

Shields had since 2004 run CFS GAM’s GDP Plus Fund, which at $20 billion is one of the largest Australian equities funds in the country. UBS GAM chief executive Paul Bolinowsky confirmed Shields’ appointment and said that Fiani’s departure after five years running Australian equities was the result of “;discussions”;. He ruled out Fiani’s stance against the unsuccessful Qantas takeover attempt as a factor in his departure, saying the stance was fully supported by his team and his board. Fiani’s tenure running Australian equities has been marked by mediocre performance, as has Shields’ at CFS GAM’s, with most analysts sheeting home the blame to excessive funds under management and the resultant lack of flexibility. However UBS GAM runs considerably less in the asset class than CFS GAM, at about $9 billion. Fiani has already left UBS. CFS GAM’s chief investment officer, David Dixon, will step in immediately as acting head of Australian equities and discussions with potential candidates for Shields’ permanent replacement have already begun, according to a CFS GAM statement issued to researchers overnight. In further bad news for CFS GAM, Shields’ 2IC Jim Taylor has tendered his resignation from the manager. At the start of August he will join BT Financial Group’s Australian equities team as a portfolio manager reporting to Crispin Murray. There have been mutterings among managed fund researchers for some time that CFS GAM’s Australian equities team were ripe for poaching, partly due to a perception their performance incentives are suffering under the weight of money dragging on CFS GAM’s domestic equity fund returns.