The Egyptian fund manager Mohamed El Erian has stepped down as the chief executive and co-chief financial officer of Pimco, one of the world’s largest fixed-income investment companies.
Neither Mr El Erian, Pimco nor Allianz Insurance, which owns the investment firm, provided a reason for the resignation.
Bill Gross, Pimco’s co-founder, who is 69, was quoted in a 2010 interview with Bloomberg as saying that Mr El Erian, who is 55, would likely take over the direction of the company when he retired.
“What happens longer term is an open question. I have no plans as of now,” said Mr El Erian.
Yesterday Mr Gross tweeted, from Pimco’s account: “Pimco’s fully engaged. Batteries 110 per cent charged. I’m ready to go for another 40 years.”
The company’s flagship fund, the Pimco Total Return Fund, recorded a loss of 1.9 per cent in 2013 – its worst performance since 1994.
Investors retreated from the fund over the course of the year. In October, it was overtaken as the world’s largest mutual fund by Vanguard’s Total Stock Market Index Fund. Net outflows from the fund totalled US$41 billion last year as investors reduced their exposure to bonds.
That month, the company hired Virginie Maisonneuve as head of equities, part of an effort to diversify the company away from its focus on bond markets.
Fixed-income investors took a hit following the Federal Reserve’s announcement that it would begin tapering at the end of last year.
Some commentators have described the global movement from bond markets into equities as “The Great Rotation” as an era of low interest rates and quantitative easing comes to a close.
The S&P index of 500 stocks gained 29.6 per cent last year, while the Barclays Aggregate, a measure of returns on United States bonds, returned minus 2.02 per cent – a clear indication of the divergence between equity and bond performance.
That is also bad news for any fund that generates more than 65 per cent of its return from fixed-income markets, as Pimco’s Total Return Fund does.
Egyptian by nationality but born in New York, Mr El Erian read economics at Queen’s College, Cambridge, before completing a master’s degree and doctorate at St Anthony’s College in Oxford.
He then joined the IMF, where he worked as a staff economist before becoming a deputy director of the organisation.
Mr El Erian moved to Pimco in 1999, where he worked until 2005. He spent two years managing Harvard University’s endowment, which attracted some controversy under his tenure for the size of its payments to staff, but recorded a 23 per cent gain in his first year in charge of the fund.
He is a prolific commentator and writes regularly for a number of newspapers and magazines, and is the author of When Markets Collide, an investment guide published in 2008.
The New York Times reported in 2012 that Mr El Erian earned $100 million that year.
Mr Gross said: “Mohamed has been a great leader, business builder and thought leader for Pimco and our clients. Together we have guided the firm and served our clients during a period of significant change in the global economy and financial markets.”
He will remain in post until March, at which point Douglas Hodge, the company’s chief operating officer, will take over. Mr El Erian will also continue to hold an advisory role at Allianz Insurance.
With presidential elections due to be held this year in his native Egypt, some commentators have suggested that Mr El Erian may look to politics for his next role.
abouyamourn@thenational.ae
* With agencies
If you go...
Etihad Airways flies from Abu Dhabi to Kuala Lumpur, from about Dh3,600. Air Asia currently flies from Kuala Lumpur to Terengganu, with Berjaya Hotels & Resorts planning to launch direct chartered flights to Redang Island in the near future. Rooms at The Taaras Beach and Spa Resort start from 680RM (Dh597).
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
The more serious side of specialty coffee
While the taste of beans and freshness of roast is paramount to the specialty coffee scene, so is sustainability and workers’ rights.
The bulk of genuine specialty coffee companies aim to improve on these elements in every stage of production via direct relationships with farmers. For instance, Mokha 1450 on Al Wasl Road strives to work predominantly with women-owned and -operated coffee organisations, including female farmers in the Sabree mountains of Yemen.
Because, as the boutique’s owner, Garfield Kerr, points out: “women represent over 90 per cent of the coffee value chain, but are woefully underrepresented in less than 10 per cent of ownership and management throughout the global coffee industry.”
One of the UAE’s largest suppliers of green (meaning not-yet-roasted) beans, Raw Coffee, is a founding member of the Partnership of Gender Equity, which aims to empower female coffee farmers and harvesters.
Also, globally, many companies have found the perfect way to recycle old coffee grounds: they create the perfect fertile soil in which to grow mushrooms.
Temple numbers
Expected completion: 2022
Height: 24 meters
Ground floor banquet hall: 370 square metres to accommodate about 750 people
Ground floor multipurpose hall: 92 square metres for up to 200 people
First floor main Prayer Hall: 465 square metres to hold 1,500 people at a time
First floor terrace areas: 2,30 square metres
Temple will be spread over 6,900 square metres
Structure includes two basements, ground and first floor
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
Tips for taking the metro
- set out well ahead of time
- make sure you have at least Dh15 on you Nol card, as there could be big queues for top-up machines
- enter the right cabin. The train may be too busy to move between carriages once you're on
- don't carry too much luggage and tuck it under a seat to make room for fellow passengers
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SECRET%20INVASION
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UAE currency: the story behind the money in your pockets
The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
Sri Lanka-India Test series schedule
- 1st Test India won by 304 runs at Galle
- 2nd Test Thursday-Monday at Colombo
- 3rd Test August 12-16 at Pallekele
LA LIGA FIXTURES
Friday Valladolid v Osasuna (Kick-off midnight UAE)
Saturday Valencia v Athletic Bilbao (5pm), Getafe v Sevilla (7.15pm), Huesca v Alaves (9.30pm), Real Madrid v Atletico Madrid (midnight)
Sunday Real Sociedad v Eibar (5pm), Real Betis v Villarreal (7.15pm), Elche v Granada (9.30pm), Barcelona v Levante (midnight)
Monday Celta Vigo v Cadiz (midnight)
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
UAE currency: the story behind the money in your pockets
What is the FNC?
The Federal National Council is one of five federal authorities established by the UAE constitution. It held its first session on December 2, 1972, a year to the day after Federation.
It has 40 members, eight of whom are women. The members represent the UAE population through each of the emirates. Abu Dhabi and Dubai have eight members each, Sharjah and Ras al Khaimah six, and Ajman, Fujairah and Umm Al Quwain have four.
They bring Emirati issues to the council for debate and put those concerns to ministers summoned for questioning.
The FNC’s main functions include passing, amending or rejecting federal draft laws, discussing international treaties and agreements, and offering recommendations on general subjects raised during sessions.
Federal draft laws must first pass through the FNC for recommendations when members can amend the laws to suit the needs of citizens. The draft laws are then forwarded to the Cabinet for consideration and approval.
Since 2006, half of the members have been elected by UAE citizens to serve four-year terms and the other half are appointed by the Ruler’s Courts of the seven emirates.
In the 2015 elections, 78 of the 252 candidates were women. Women also represented 48 per cent of all voters and 67 per cent of the voters were under the age of 40.
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
