NEW YORK, NOV. 14 -- Two high-level First Boston Corp. executives announced their resignations today, furthering a wave of departures at the struggling Wall Street firm during a major overhaul.
First Boston's chief financial officer and the head of its asset management division announced they would leave at the end of 1990. On Tuesday, three executives who were hired less than a year ago to run the firm's bond-trading department stepped down. Several other top executives have resigned in recent months.
The disarray stems partly from a severe downturn in the securities industry, particularly the collapse of the nation's junk bond market, in which First Boston was a key player. Internal tension also has hurt the firm.
On Tuesday, CS Holding, the Swiss owner of CS First Boston Inc., announced it would inject $300 million in equity and $425 million in cash into the firm. First Boston Corp. is the main U.S. subsidiary of CS First Boston.
The rescue is the latest this year by a wealthy parent of an ailing investment firm. As part of the transaction, First Boston plans to dismiss 200 workers by year-end, adding to about 600 layoffs so far this year. The firm has about 3,850 employees in the United States.
The deal gave CS Holding, which also owns Switzerland's No. 3 bank, Credit Suisse, 60 percent control of CS First Boston.
James Freeman, head of First Boston Asset Management Corp., said in an interview that he decided to resign after 16 years at the firm in part to let the overhauled management run the company. He said he was not leaving on bad terms.
"You have a new group of people and that new group of people deserves to have its vision," Freeman said in an interview.
"We have certain problems that relate to the company, certain problems that relate to the industry," he said. "The company is in excellent shape today. It has gone through some unbelievably tumultuous times from an emotional state and financial state."
Also announcing his resignation was Anthony Grassi, CS First Boston's chief financial and administrative officer. Freeman and Grassi were the last two remaining members of the firm's original management committee from 1983. Grassi has been at the firm 15 years.