BlackRock High-Yield Debt Managers Resign From Firm - they run the toxic stuff of the FED?

What makes the news beneath kind of interesting is the fact that Blackrock is the advisor and manager of many distressed debt the FED has on its book right now like the 30 bil of toxic stuff from Bear Stearn's or to put it more precise the taxpayer took over from JP Morgan's takeover. This and another position have gather multi billion of losses by the end of last year already. I am pretty positive that this facts have a high correlation as those 2 guys were in charge of exactely that kind of products

BlackRock High-Yield Debt Managers Resign From Firm (Update1)

By Kristen Haunss and Pierre Paulden

May 14 (Bloomberg) -- BlackRock Inc., the largest publicly traded U.S. asset manager, said Mark Williams and Kevin Booth, two managing directors who ran high-yield debt portfolios, resigned.

Williams oversaw the New York-based company’s bank-loan investment team and was co-head of its leveraged finance business, while Booth was co-head of the firm’s high-yield team and co-ran the leveraged finance business. BlackRock had $1.28 trillion in assets under management as of March 31.

The pair left BlackRock as high-yield debt is recovering from the worst year on record. The S&P/LSTA U.S. Leveraged Loan 100 Index returned 28 percent this year through May 11 after dropping 28 percent in 2008.

High-yield bonds have returned 21 percent in 2009, rebounding from a 26 percent loss last year, according to the Merrill Lynch U.S. High Yield Master II Index.

BlackRock Senior Floating Rate Fund Inc., which invests in corporate loans and was managed by Booth, is up 18 percent this year after declining 28 percent in 2008, according to data complied by Bloomberg.

Leveraged loans and junk bonds are rated below Baa3 by Moody’s Investors Service and BBB- at Standard & Poor’s.

Bobbie Collins, a BlackRock spokeswoman in New York, declined to comment.

New Hires

The firm hired 29 investment professionals on April 30 from R3 Capital Partners, a $1.5 billion fixed-income alternative investment manager. The additions included Rick Rieder, a former Lehman Brothers Holdings Inc. trader who founded the hedge fund. Rieder now heads BlackRock’s fixed-income alternatives portfolio team, according to a statement on the firm’s Web site.

James Keenan, Mitch Garfin and Derek Schoenhofen are now managing the BlackRock High Yield Bond Portfolio, according to a May 8 filing with the U.S. Securities and Exchange Commission. Leland Hart and Adrian Marshall are now the portfolio managers for the BlackRock Senior Floating Rate Fund, which invests in high-yield, high-risk loans, according to another regulatory filing that day.

Hart joins from R3 as does Michael Phelps, a managing director and member of the leveraged finance portfolio team. Before joining BlackRock, Phelps was the head of R3’s European businesses.