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This morning, financial services firm Legg Mason (NYSE: LM ) announced that chairman and CEO Mark Fetting will step down on Oct. 1. In the meantime, the company has pegged its head of global distribution, Joseph Sullivan, as interim CEO while the company’s lead independent director W. Allen Reed will take on the position of non-executive chairman.
Legg Mason has had its share of problems these last few years, especially during the financial crisis. In 2005, the company’s founder and then-CEO Raymond Mason traded Legg Mason’s brokerage unit for Citigroup’s asset-management business. Of course, this was one of Citigroup’s many toxic assets, and Legg Mason was left holding the bag when the recession began. In 2008 alone the company’s stock dropped nearly 70% as shareholders ran for the hills. Legg Mason hasn’t recovered since.
The fact that many of Legg Mason’s competitors have recouped their losses since 2008 doesn’t help. While the company’s stock has recovered about 12% since the beginning of 2009, competitor BlackRock has gained nearly 28% in the same time frame.
Shareholders have taken the news of Fetting’s departure well, with the company seeing a 4% bump within the first half hour of trading today. But the stock has had a very choppy trailing 12 months, with its chart looking like a rollercoaster from hell. Despite the ups and downs Legg Mason has experienced this year, it’s still down 2.11%. Shareholders can only hope that whoever the firm digs up will lead Legg Mason to new profits.