In April, when three executives left SunBank Capital Management in Orlando to start their own firm across the street, a friendly rival sent them a bouquet to wish them well.
That rival, James R. Wood, might now want to send them a thank-you note.
The former executive vice president at Franklin Resources' Templeton International has now been hired as president of the SunTrust Banks Inc. money management unit, replacing one of the three.
Mr. Wood still plays golf with the trio - former president John D. Race, star money manager Gregory DePrince, and former marketing chief Victor A. Zollo. And Mr. Wood said he hopes he can keep doing so while revamping the money management firm they shook up by departing.
"It sends a bit of a shock through an organization" when top executives leave, Mr. Wood said. "But I don't put that on the personal level. There is a lot of business for everyone out there."
Mr. Wood, 56, got to know Mr. Race 10 years ago as a senior consultant advising SunTrust's money management subsidiary.
He also got to know and befriend Anthony R. Gray, the unit's chairman and chief executive and the man who persuaded Mr. Wood to leave Templeton.
He is full of praise for his new unit and for Mr. Gray, a legendary money manager who has been credited for the growth of SunBank Capital from $1.9 million of managed assets to its present $11 billion.
"They are really the epitome of the bank-affiliated money management firm," Mr. Wood said.
But recently, the unit hasn't lived up to its past reputation.
It has been bleeding assets ever since Mr. Race and his two colleagues left, promising to take with them $1 billion of business. So far, it looks as though SunBank has lost $400 million of assets.
Mr. Wood said he would try to expand the fixed-income and international equity areas of the group, as well as to increase distribution of the $5.5 billion-asset STI Classic Mutual Funds, SunTrust's family of funds that the unit helps manage.
He said he would also try to prevent the kind of client and asset drain SunBank has experienced recently. He will, for example, have managers sign "no-compete" contracts, prohibiting them from soliciting clients or speaking against the unit upon leaving it.
But Mr. Wood still must figure out how to keep managers from leaving. Compensation for money managers at bank-affiliated investment subsidiaries is said to be far less than what independent money management firms or mutual fund companies pay.
While Mr. Wood called SunBank's compensation system "very, very favorable," he acknowledged that a bank cannot compete with the potential that ownership in a start-up firm offers would-be entrepreneurs - a major reason the three executives left SunBank.
"The only thing missing is the direct equity ownership, which you can't do under the structure of the bank," Mr. Wood said.
