Mohamed El-Erian resigns from Pimco, to stay on at Allianz
BOSTON (Reuters) - Mohamed El-Erian, long seen as the heir apparent at the world's biggest bond fund manager, is stepping down from his roles at Pacific Investment Management Company.
Pimco's parent, German insurer Allianz, (ALVG.DE) said on Tuesday that El-Erian would resign as the asset manager's chief executive officer and co-chief investment officer.
The company did not give a reason for El-Erian's departure, but the bond market was hit hard last year as investors moved money to stocks from bonds.
El-Erian will stay on to consult at the German insurer, but the news that he would leave Pimco took the investment community by surprise.
El-Erian, 55, is well known due to his frequent appearances on cable television and at investment conferences.
He sent out an email announcing his departure that failed to shed more light on the decision.
Bill Gross - the co-chief investment officer and co-founder of Pimco and manager for the $237 billion PIMCO Total Return Fund - tweeted "PIMCO's fully engaged. Batteries 110 percent charged. I'm ready to go for another 40 years!"
Two years ago, Gross, now 69, told the New York Times, "Mohamed is my heir apparent."
Allianz named Douglas Hodge, managing director and currently chief operating officer of the firm, as its next chief executive. The firm also named managing directors Andrew Balls and Daniel Ivascyn as deputy chief investment officers.
The news comes after Pimco had a record $41.1 billion in outflows last year, according to the investment research firm Morningstar. Pimco till managed $1.97 trillion in assets as of September 30, 2013 according to its website.
"Mohamed El-Erian helped set the strategic direction of the company and it certainly makes a difference when someone who is used to making such headlines leaves a company," said Jeff Tjornehoj, senior research analyst at Lipper. "We don't know what kind of impact it will have yet but it will have an impact."
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