Pacific Investment Management Co.'s flagship fund fell below $100 billion in assets under management for the first time in more than eight years, leaving it with about a third of the money it managed at its 2013 peak.
Investors pulled $1.8 billion last month from the PIMCO Total Return Fund. Withdrawals are slowing, following outflows of $2.5 billion in July, $3 billion in June and $2.7 billion in May, according to a statement from PIMCO. After 28 consecutive months of outflows, assets plunged to $98.5 billion as of Aug. 31 from a high of $293 billion in April 2013, when the mutual fund was the world's largest.
This is the first time the Total Return Fund has held less than $100 billion since January 2007, before strong returns during the financial crisis spurred an influx of cash from investors seeking the relative safety of bonds. Customers have pulled record amounts of money since April 2013, concerned about the impact of rising interest rates, fluctuating performance and last year's sudden departure of William H. Gross, the PIMCO co-founder who had managed the fund for decades.
Total Return was the largest mutual fund until October 2013. It lost the title of world's biggest bond fund this April as investors continued the exodus from actively managed products.
The fund, now run by Scott Mather, Mark Kiesel and Mihir Worah, returned 0.6% this year, outperforming 73% of peers as of Sept. 1, according to data compiled by Bloomberg. The fund trailed the majority of its peers in both 2013 and 2014.