March 14, 2012 / 4:07 PM / 6 years ago

UPDATE 2-Goldman's defined contribution head departs

* Bill McDermott latest to depart asset management division

* Comes after Dwight Asset added to beef up defined contribution biz

* Goldman in spotlight after exec Greg Smith left ripping “toxic” culture

March 14 (Reuters) - The head of the defined contribution business at Goldman Sachs Group Inc has left the firm.

A Goldman spokeswoman confirmed that Bill McDermott, who was head of the defined contribution business at Goldman Sachs Asset Management, has left after a little over two years at the firm. McDermott could not immediately be reached for comment.

His responsibilities have been taken over by Jim McNamara, head of third party distribution, and Craig Russell, head of the institutional business at Goldman Sachs Asset Management, the spokeswoman said. She could not say if the firm was hiring a replacement.

McDermott’s exit is the latest in a string of departures from the asset management division, and the news came as Goldman was in an unwanted spotlight following the departure of an executive who publicly ripped the company’s ethics and corporate culture.

In April 2011, Steve McGuinness, co-chief operating officer of Goldman Sachs Asset Management’s investment management business and global head of distribution, left the firm.

In December 2010, Eileen Rominger, chief investment officer at GSAM and an 11-year veteran of the firm, stepped down to become head of the Securities and Exchange Commission’s Division of Investment Management.

Earlier in 2010, Mark Spilker, co-head of the investment management division and a member of the management committee, announced that he was retiring. He was 45 years old. Ten months later, he became president of Apollo Global Management LLC.

McDermott’s departure comes just weeks after GSAM announced it was acquiring Dwight Asset Management Co LLC to ramp up its defined contribution business.

Goldman Sachs has been under increasing scrutiny by regulators and the public for its involvement in the 2008 financial crisis.

In a Wednesday Op-Ed piece, Greg Smith, head of the firm’s equity derivatives business, announced his resignation, blaming the firm’s “toxic and destructive” culture.

While Goldman’s fixed income mutual funds performance has continued to lag, the performance of its equity funds has improved, said Jeff Tjornehoj, head of Americas research at Lipper.

Over the past three years, 26 percent of the firm’s bond funds have beaten their peers, down from 69 percent for the past five years, according to Lipper.

Meanwhile, 71 percent of its equity funds have beaten their peers over the past three years, up from 38 percent for the past five years.

Goldman said when McDermott was hired that he had been Executive Vice President, Corporate Markets, at AXA Equitable Life Insurance Company. Prior to AXA, he spent 12 years in executive management at Fidelity Investments, where he was responsible for growing large corporate market and client solutions groups.

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