SOURCE: Smith Breeden Associates

Smith Breeden Associates

March 23, 2011 09:00 ET

Smith Breeden Chairman Michael Giarla Named Chief Executive Officer

Current CEO Gene Flood Departing to Join TIAA-CREF

DURHAM, NC--(Marketwire - March 23, 2011) -  Smith Breeden Associates today announced that effective immediately Michael J. Giarla, the Firm's Chairman, will assume the position of Chief Executive Officer, replacing current CEO Eugene Flood, Jr., PhD, who will join TIAA-CREF in May.  Smith Breeden is a research-driven institutional global asset management firm.

Both Mr. Giarla and Dr. Flood are members of Smith Breeden's Executive Committee, which is responsible for the day-to-day operations of the Firm. In addition to assuming the role of Chief Executive Officer, Mr. Giarla will continue as Smith Breeden's Chairman and Chairman of the Firm's Executive Committee. Mr. Giarla has held a variety of roles during his 26-year tenure at Smith Breeden, including President and Chief Operating Officer. He has been a member of Smith Breeden's Board of Directors since 1988 and the Firm's Chairman since 2005. He is a widely-published authority on MBS investments, risk management, and hedging.

"Proposed changes to government-sponsored enterprises resulting from the recently-passed turmoil in the financial markets bode well for Smith Breeden. Being a highly-skilled group of professionals under the capable leadership of a thoughtfully-constructed Executive Committee -- I am confident that Smith Breeden will continue to thrive as it focuses on its pioneering strengths to address the exciting opportunities at hand. I am grateful to have had the opportunity to work with them," stated Dr. Flood.

"We are grateful to have had Gene serving as our CEO for the past 10 plus years. During this time, he's contributed significantly to the Firm and its stature throughout the institutional investment community. We wish him the best of luck in this next stage of his remarkable career," stated Mr. Giarla.

"We are delighted that Mike has decided to serve as Smith Breeden's Chief Executive Officer during this time of profound change in the financial markets and especially the domestic mortgage markets. His extensive experience with the Firm and in the fixed-income markets make him ideally suited for this role. With a 29-year history of pioneering work in developing and applying quantitative financial analysis to mortgage-backed security valuation and trading, Smith Breeden is well positioned to be of benefit to institutional investors in this important market segment," stated Steve Eason, CFA, Executive Vice President and Executive Committee member.

Smith Breeden moved to an Executive Committee approach to managing the Firm's day-to-day operations in late 2008 in response to turmoil in the financial markets and coincident with the formation of a Chief Risk Officer position, which is held by John Sprow. Following Dr. Flood's departure, members of the Smith Breeden Executive Committee remain Messrs. Giarla, Eason, Sprow, and Daniel Adler, who is Director of the Firm's Investment Management Group and a Senior Portfolio Manager.

Dr. Flood joined Smith Breeden Associates in 2000.  Since 2005, Dr. Flood has been a member of the CREF and TIAA-CREF Mutual Funds Board of Trustees, and Chairman of their Investment Committees.  Dr. Flood will continue to work with Smith Breeden until he joins TIAA-CREF in May.  He remains a shareholder in Smith Breeden.

About Michael J. Giarla
Mr. Giarla is Chairman of the Board, Chief Executive Officer, and Chairman of the Executive Committee of Smith Breeden Associates, Inc. During his 26-year tenure, Mr. Giarla has served as President (1997-2000); President of Smith Breeden Mutual Funds (1994-2000; until its merger with The Managers Funds); Chief Operating Officer (1988-2004); Board Member (1988); Partner/Principal (1986-1988); and Associate (1985). While serving as the Firm's Director of Research during the mid to late 1980s and early 1990s, he published numerous articles and book chapters on MBS investments, risk management, and hedging, and was an Associate Editor of The Journal of Fixed Income (1991-1993).

Over the years, Mr. Giarla has served on the boards of public and private for-profit companies, and not-for-profit organizations. He is currently a member of the Board of Directors of Self Help (Durham, NC) and the Self Help Ventures Fund (2005 - present), where he is a member of the Audit Committee of the organization and all of its affiliates, including the Self Help Credit Union (Durham) and the Self Help Federal Credit Union (CA). He also serves on the board sub-committee charged with addressing succession planning issues and CEO performance/feedback. 

Mr. Giarla's published articles and book chapters include: "The Profitable Side of Risk Management" (Asset/Liability Management); "Adjustable-Rate Mortgages, Panacea or Poison" (Adjustable-Rate Mortgages and Mortgage Backed Securities); "Hedging Interest Rate Risk with Futures, Swaps and Options" (The Handbook of Mortgage-Backed Securities, Asset/Liability Management); and "The Implications of Active and Passive MBS Portfolio Strategies" (The Secondary Mortgage Market).

Mr. Giarla holds an MBA in Finance from the Stanford University Graduate School of Business (1985), where he was an Arjay Miller Scholar. He earned a BA in Statistics, summa cum laude, from Harvard University (1981), where he was elected to Phi Beta Kappa and was a Harvard Club of Boston Scholar. 

About Smith Breeden Associates
Founded in 1982, Smith Breeden Associates provides full discretion fixed income asset management and advisory services to pension funds, endowments, foundations, funds-of-funds, and banks. Focusing primarily on the major US fixed income sectors, Smith Breeden's product line includes a variety of traditional fixed income and absolute return strategies.

Smith Breeden has a 29-year history of pioneering work in developing and applying quantitative financial analysis to mortgage-backed security valuation and trading. The firm developed some of the earliest mortgage prepayment forecasting models in the early 1980s, and was among the first firms to apply option pricing techniques to the analysis of mortgage investments. In the late 1980s, Smith Breeden was retained by the FDIC to analyze, hedge, and liquidate a variety of complex mortgage derivative portfolios. In the 1990s, Smith Breeden was one of the first firms selected by Freddie Mac (FHLMC) to participate in their outside manager program.

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