Oppenheimer 60th Anniversary - 58

Reprinting of From Opportunity to
Legacy: Celebrating the First Fifty Years

The Mind of Wall Street

plans, expanded pension and retirement plan
offerings, and trust services. All this was accomplished while the core mutual fund business
continued to grow rapidly, further strengthening
the Company's position.

In 2002, founding partner Leon Levy, a veteran of more
than 50 years on Wall Street, published his reflections
on how the financial markets operate. His observations WEATHERING A
DIFFICULT ECONOMY
on the volatility that characterized the markets when
While OppenheimerFunds was building the structhe book was published were especially timely. n
ture and product offerings that would support its
would transform the firm. In 2001, the overwhelming concentration of OppenheimerFunds assets
- 96% - was in the advisor-sold mutual fund
retail business. To address concerns that stemmed
from being so highly concentrated in one business,
the Company pursued a diversification strategy, the
heart of which was a new structure and an expansion of products.
Some elements of the new direction were already
in place when Murphy took the helm at OppenheimerFunds. Trinity Investment Management, for
example, which managed investments for institutional clients, had been acquired in 1999 to reestab-

lish a presence in that segment of the marketplace,
and OFI Private Investments had been created in
2000 to offer separately managed wrap accounts to
affluent investors.
But there was more to come. OppenheimerFunds
created OFI Institutional Asset Management in
2001, which housed Trinity and other acquisitions
and new products to serve a wider set of institutional clients. The Company completed a series of
acquisitions and restructurings over the next several
years that benefited both the institutional and
high-net-worth segments. The product base was
broadened as well, to include 529 college saving

growth - and demonstrating extraordinary
perseverance in the face of post-September 11
challenges - outside forces were testing the Company's resilience even further. The bursting of the
technology bubble in 2000 had already sent the stock
market reeling, and the events of 9/11 deepened the
bear market. Subsequently, major corporate scandals, like Enron and WorldCom, added to the market
woes. And, closer to home, clouds were forming over
the mutual fund industry. The run-up to the Iraq
War in 2003 caused still more investor angst. Yet
OppenheimerFunds weathered these storms, thanks
to a combination of investment management skill
and an ingrained culture of integrity and trust.
The immediate financial threat, the bear market,
had less of an impact on OppenheimerFunds than on
many other investment companies, in part because of
the Company's strong brand and sales force, and
because of its diverse product line.
"We had a number of big global events, which
had a major impact on the markets, and in almost
all cases we were ahead of the crowd and generally
on the right side of the trades," said Bill Wilby, who
retired in 2007 as director of equities investing.

STEERING CLEAR OF
INDUSTRY SCANDALS

2002

The euro is introduced as the currency of the European Union.

Kenneth Lay, former chairman and chief executive
of Enron, is indicted on 11 counts of securities fraud
and other charges. Image replaced

A coalition of forces led by the United States invades
Iraq, touching off Operation Iraqi Freedom.

2003

58 * OppenheimerFunds: The First Fifty Years

GETTY IMAGES

2001

While the Company's team-based investment
approach (see page 37) helped it to navigate the
bear market, OppenheimerFunds' culture helped it
avoid the mutual fund industry scandals of 2003,
which stemmed primarily from late trading and
market-timing allegations that other firms allowed.
The story broke in September with the announcement by the New York state attorney general that he
had "obtained evidence of widespread illegal trading

Oppenheimer 60th Anniversary

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