Pimco's chief executive said on Monday his firm has risen to the challenge of losing its star investor, Bill Gross, and is rolling up its sleeves and moving on.
The executive, Douglas M. Hodge, said that Mr. Gross' eventual exit from the firm he cofounded was "inevitable," and while the media has focused on "turmoil" and "disruption," the staff at Pimco has moved on.
"We were prepared for it, and that's the part of the story that may not be quite as sexy as the other stuff, but now six weeks later the narrative has moved on," he said.
Mr. Hodge spoke on the sidelines after participating on a panel in New York at the annual conference of the Securities Industry and Financial Markets Association, a Wall Street lobby.
Newport Beach, Calif.-based Pacific Investment Management Co. lost $48 billion to investor redemptions last month, its 17th month of mutual fund outflows, according to estimates by Morningstar Inc.
Other firms in the space have been gathering assets, including Denver-based Janus
Capital Group Inc., which hired Mr. Gross amid his abrupt departure from Pimco on Sept. 26.
Janus took in $1.1 billion in October, including nearly $364 million into the strategy now run by Mr. Gross, the Janus Global Unconstrained Bond Fund (JUCAX), Morningstar said.
The TCW Group Inc.'s MetWest unit, DoubleLine and
BlackRock Inc. are among the firms that
have won billions into their flagship funds.
Still, no top talent has followed Mr. Gross out of Pimco.
"Yes, there's a degree of anxiety; I mean, your co-founder can only leave once so we had to process that," said Mr. Hodge. "But now, six weeks in, people are working hard. I mean, we have an extraordinarily dedicated group of people, and people are excited."
The remarks come as Pimco has gone to extra lengths to retain its staff, which includes one of the world's largest corps of fixed-income specialists.
Pimco's Munich-based parent Allianz SE disclosed last Thursday that Pimco has rolled out a new performance award on top of its existing compensation for staff "to secure performance and to retain talents."
The bonus consists of deferred cash payments that will be paid out over the next 12 to 30 months. The program will cost €33 million (about $41 million) each quarter until the end of 2015 and €10 million ($12.4 million) for each of the six quarters after that.
That's about $285 million in all.
"We operate in a market where the competition for talent is fierce," said Mr. Hodge.
