Eric Michel, president and representative director at State Street Japan in Tokyo, has just transferred to Paris, to be replaced by Mark Lazberger. Michel is returning to Europe to spearhead the firm's distribution effort of fund products. He oversaw a massive expansion of State Street Global Advisor's business in Japan, buoyed by the recent popularity of indexing by leading corporate and public pension funds. For the past three or four years, SSGA's assets under management in Japan grew as much as 70%, and the firm today manages about $20 billion there.

So Lazberger has large shoes to fill. But he comes from a success story of his own, having run the firm's Australia business for a decade or so. When he joined 11 years ago, the firm had only six corporate clients down under, and was mainly a custody business. Today, he says, SSGA is the second-largest wholesale fund manager in Australia. Indeed, he will keep his role running Oz even while assuming responsibilities in Japan, and his title is State Street's head of investment management for Japan, Australia and New Zealand.

He is still getting his feet wet in the Japanese market, so Lazberger declined to go into details about SSGA's immediate plans. He acknowledges that the tremendous growth rates of the Michel years will be tough to replicate, but believes that passive investment is still a growing trend in Japan. ôCorporates realize it makes sense to allocate a significant portion of their assets passively, especially in a low-interest rate environment were institutions really have to watch costs,ö he says.

But the office retains a steadying hand in the form of Koji Yamamoto, who continues his role as president and representative director at SSGA. And most of Lazberger's work will involve deepening relationships with clients, potential clients and industry partners such as Chuo Mitsui Trust & Banking. Another partner is Citibank in the defined contribution arena. Here Lazberger is reluctant to get into details. In the United States, Citibank and State Street have a 50/50 joint venture called CitiStreet which provides both recordkeeping services to 401(k) accounts as well as fund products. The JV has also been introduced in Australia, but without the fund products side.

In the past the two houses have considered importing CitiStreet to Japan, to handle recordkeeping for Japan's new defined-contribution law. But Citibank ended up throwing in its lot with one of two local consortia for recordkeeping. SSGA would still like a role, says Lazberger, perhaps providing investment pools in various asset classes for use by pension plans' DC schemes. But having just arrived in Tokyo, he says his assessment of the market is still underway.