The PIMCO Total Return Fund lost nearly a third of the assets allocated to it by plans among the 100 largest U.S. corporate DC funds during 2014, new data show.
Assets in the flagship fund held by the top 100 plans as measured by Pensions & Investments dropped 29% to $6.82 billion from $9.67 billion the previous year, according to 11-K filings with the Securities and Exchange Commission and recent Form 5500 filings with the U.S. Department of Labor.
A spokeswoman for Pacific Investment Management Co., Newport Beach, Calif., declined comment.
Thirty-five of the companies in P&I's universe reported holdings in PIMCO Total Return at year-end 2013.
Wal-Mart Stores Inc., Bentonville, Ark., accounted for 42.8% of that loss. The retail behemoth's 401(k) plan had $1.2 billion in the Total Return Fund — about 5.8% of the total $20.6 billion in the plan — at the end of its fiscal year on Jan. 31, 2014, and none a year later. The BlackRock U.S. Debt Index Non-Lendable fund appears likely to have replaced the Total Return Fund in the plan's lineup to some extent, with $1.8 billion in assets as of Jan. 31, 2015; it had less than 5% of plan assets the year before.
Wal-Mart still had $594 million in the PIMCO All Asset Fund as of Jan. 31, up 8% from the year before.
Randy Hargrove, Wal-Mart spokesman, declined to provide comment.
While the filings do not provide the motivations for the changes, the departure of PIMCO's co-founder and then-Chief Investment Officer William H. Gross on Sept. 26, 2014, resulted in a total of $79.9 billion in redemptions from the PIMCO Total Return Fund in the final three months of 2014.
Other plans among the 100 largest U.S. corporate 401(k) plans that reported zero assets in the fund at of the end of 2014 after holding more than $100 million a year earlier were: Merck & Co. Inc., Kenilworth, N.J., which had $551 million as of Dec. 31, 2013; Ford Motor Co., Dearborn, Mich., which had $242 million; U.S. Bancorp, Minneapolis, $213 million; and Leidos Inc., Reston, Va., $143 million.
Emerson Electric Co., St. Louis, which reported $165 million in the Total Return Fund as of Sept. 30, 2014, removed the fund from the lineup effective Jan. 8, replacing it with a domestic core-plus fixed-income fund managed by Loomis Sayles & Co. LP.
Delta Air Lines Inc., Atlanta, which had $138 million in the PIMCO Total Return Fund at the end of 2013, removed the option from its lineup before the end of 2014, a company spokeswoman said. She would not provide further comment.
Publix Super Markets Inc., Lakeland, Fla., which had $28 million in the fund in its 401(k) plan at the end of 2013, had removed the Total Return Fund because of “personnel changes,” Robert L. Kisiel, investment manager, said in June. The company replaced it with a fixed-income fund managed by Baird Advisors.
Of the 35 corporate DC plans that had assets in the PIMCO Total Return Fund at the end of 2013, 10 plans reported an increase in the assets in the fund during fiscal year 2014.
Southwest Airlines Co., Dallas, reported the largest increase in assets in the fund, at 18.2% to $680.5 million.
Two plans also reported a significant drop in assets greater than 10%, while retaining the fund. CVS Health Corp., Woonsocket, R.I., reported a 23.1% drop in assets in the year ended Dec. 31, 2014, to $353.3 million, and Bank of America Corp., Charlotte, N.C., reported a drop of 16.1% to $376.8 million.
