Pacific Investment Management Company, LLC (commonly called PIMCO), is a global investment management firm headquartered in Newport Beach, California, with over 2,000 employees working in 13 offices across 12 countries. PIMCO is a fixed income investment management company, with $1.2 trillion in 3rd party assets under management as of January 17, 2015. The company also manages $400 billion in assets for Allianz. The company runs the largest bond mutual fund in the world, the PIMCO Total Return Fund, and provides portfolio management and asset allocation solutions for millions of investors worldwide. PIMCO offers a broad list of investment strategies that encompass the entire risk spectrum and capital structure, including structured credit, alternatives, real assets, equities and currencies. PIMCO also has an ETF business, which had approximately $13.581 billion in assets under management, as of Jan. 21, 2014.
PIMCO oversees investments on behalf of a wide range of clients, including millions of retirement savers, public and private pension plans, educational institutions, central banks and government agencies, foundations and endowments and financial intermediaries among others.
The firm is known to have coined and popularized the phrase "the New Normal" in the aftermath of the subprime mortgage crisis in 2009. More recently, PIMCO introduced the "New Neutral" thesis to characterize a period of lower but stable economic growth, and interest rates to remain low for a longer period of time.
Leadership
PIMCO's CEO is Douglas Hodge, who succeeded Mohamed El-Erian in 2014, and the firm's President is Jay Jacobs. Dan Ivascyn, Group Chief Investment Officer (CIO), broadly oversees portfolio management and investment strategy. There are also five CIOs: Andrew Balls, CIO Global Fixed Income; Mark Kiesel, CIO Global Credit; Virginie Maisonneuve, CIO Global Equities; Scott Mather, CIO U.S. Core Strategies; and Mihir Worah, CIO Real Return and Asset Allocation.
History
The firm was founded in 1971, launching with $12 million of assets. Previously, PIMCO had functioned as a unit of Pacific Life Insurance Co., managing separate accounts for that insurer's clients. In 2000, PIMCO was acquired by Allianz SE, a large global financial services company based in Munich, Germany, but the firm continues to operate as an autonomous subsidiary of Allianz.
PIMCO became the center of controversy in 2013 when turmoil between Mohamed El-Erian and William Gross went public amid tepid fund returns. Internal firm documents also leaked concerning employee pay inequality.
On September 26, 2014, it was announced that Bill Gross, co-founder and former chief investment officer, was stepping down to join Janus Capital Group. This was an unexpected event and triggered accelerated redemptions from the firm's largest fund, Pimco Total Return Fund, amounting to US$60 billion in September, October and November 2014, collectively. The fund had been experiencing significant redemptions since its peak valuation of US$293 billion was reached in April 2013; as of December 2014, the valuation had fallen to US$163 billion. Redemptions appeared to have begun because "the Federal Reserve hinted it would unwind stimulus measures". However, removal of US$4.9 billion in 2014 by New York City pension funds was "due to concerns over recent organizational changes". The ranking of the fund among peers was at one time number 1, but dropped to number 3, based on total holdings, as of December 2014.
References
External links
- Company home page
- Yahoo! - Pacific Investment Management Company LLC Company Profile
- Bloomberg - Pimco to focus on global funds
- Wall Street Journal - Inside the Showdown Atop Pimco
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