Pimco Returns to Net Inflows, Boosting Allianz Shares -Update
November 11 2016 - 5:25AM
Dow Jones News
By Ulrike Dauer
FRANKFURT--Investors put money into U.S. fund manager Pacific
Investment Management Co. in third quarter after three years of
taking it out, boosting shares of parent company Allianz SE,
Europe's largest insurer.
Pimco has been a trouble spot for Allianz ever since its
co-founder, Bill Gross, abruptly left the firm in September 2014.
His departure sparked an outflow of client money across its funds,
including the flagship Total Return fund.
In the third quarter, Pimco saw its first quarterly net inflows
since the second quarter of 2013, Allianz said on Friday. Pimco's
net asset inflows amounted to EUR4.7 billion between July and
September, compared with EUR16 billion in net outflows a year
earlier.
While Pimco has on occasion shown a net inflow of funds on a
monthly basis, investors have been awaiting a convincing reversal
with quarterly net inflows.
This month Emmanuel Roman took over as chief executive at the
fund manager, with a focus of loosening its dependence on the
traditional bond market.
Allianz's net profit in the quarter ended Sept. 30 jumped 37% to
EUR1.86 billion ($2.03 billion) boosted by the turnaround at the
fund manager, known as Pimco, as well as lower disaster claims and
improvements in its life and health insurance business. The result
was considerably above an analysts' forecast of EUR1.56 billion and
EUR1.36 billion posted in the year-earlier period.
Shares in Allianz rose more than 4% shortly after market open,
leading the DAX index. At 0900 GMT, shares traded 3.3% higher at
EUR153.70, with traders citing the Pimco news as the most important
factor in the move.
"Particularly the fact that Pimco has finally managed to show
net inflows again should be seen positively," said Philipp Hässler,
an analyst with Equinet.
On a conference call, Allianz Chief Finanical Officer Dieter
Wemmer cautioned that Pimco could still see net outflows in
individual months.
"Sentiment at Pimco is very positive, but I don't think that
from now on every month all figures will point upward," Mr. Wemmer
said.
In light of political changes taking place in the U.S., he also
warned that big customers could change their asset allocation in
coming months.
Allianz also reported a 0.5% increase in revenue to EUR27.7
billion. Operating profit, the German insurer's main yardstick,
rose 18% to EUR2.90 billion ($3.16 billion), well above analyst's
forecast of EUR2.57 billion.
The insurer maintained its full-year operating profit guidance.
It still expects operating profit of EUR10 billion to EUR11 billion
for the full year.
Write to Ulrike Dauer at ulrike.dauer@wsj.com
(END) Dow Jones Newswires
November 11, 2016 05:10 ET (10:10 GMT)
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