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Allianz: 'The Bill Gross discussion has subsided'
Chief financial Officer of German insurer Allianz (XETRA: ALV-DE) said bond fund manager Pimco, which has seen record outflows since star manager Bill Gross departed last year, is still "the strong bond house it used to be", even as outflows continued at a rate of $32 billion in the second quarter of this year.
Chief Financial Officer Dieter Wemmer said its Total Return Bond Fund, once managed by Gross and at its peak was the largest bond fund in the world is still showing "excellent performance" as is nearly back to its best days, in terms of delivering returns for investors.
"I think Pimco is still the strong bond house it used to be as the performance of the funds - the performance of the Total Return Bond fund has an excellent performance year to date, it is almost back, despite the outflows, so really a big bravo to the managers that have achieved this performance and out income fund is clearly one of the best in the industry, beating 98 percent of the rest," Chief Financial Officer of Allianz, Dieter Wemmer told CNBC.
Wemmer said outflows from Pimco had slowed even further in July from the second quarter, as Allianz, its parent firm, posted posted better-than-expected second-quarter earnings on Friday, benefiting from low claims payouts.
"Asset Management performed within expectations.Third-party net inflows at Allianz Global Investors reached a new record high while outflows at Pimco more than halved compared to the first quarter of 2015," he said.
Investors have pulled some $42 billion from Pimco's flagship Total Return Bond Fund (NASDAQ: PTTRX-O) alone in the first six months of this year, according to Morningstar data, this follows the $103 billion redeemed from the fund in 2014, following Gross's departure. The fund's currents assets under management sit at around $102 billion, from a high of $293 billion in April 2013.
Gross, known as the 'Bond King' for his long tenure delivering stellar returns, shocked investors last September when he quit Pimco, the firm he co-founded for smaller rival Janus Capital.
"I think the Bill Gross discussion has really subsided and it is now much more the discussion about how to allocate the money best in the current financial market environment," Wemmer said.
"I think the overarching topic which also us as one of the largest investors in the world, with our own money is our main topic in all of our management discussions."
The insurer posted a 15 percent increase in profits attributable to shareholders, and said it expected strong operating profits for the year at the top of its target range of 10.8 billion euro, up around 5 percent from the year before.
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