The money-management firm Pacific Investment Management Co. is set for a large number of redemption requests, the majority of which will be from their main fund which handles bond investments. This is due to the recent departure of co-founder Bill Gross.  Since the start of the year, this withdrawal has lead to a total of $25 billion.

As the information broke on Friday PIMCO (NYSE:PHK) was inundated with calls from financial advisers who were seeking clarification that Gross, whose responsibilities included PIMCO (PTTRX)’s $221 bilion Total Return fund had left for rival asset manager Janus (NYSE:JNS) Capital group. This led to more than $500 million being withdrawn from the Total return fund on Friday and speculation about billions more from other funds.

In light of these events PIMCO (NYSE:PHK) SEO’s are braced for withdrawals of up to $60 billion leaving the bond fund and other investments. These figures are so high due to the fact that the firm were unprepared for Gross’s departure, and also because PIMCO (NYSE:PHK) have been doing a job in ensuring that executive affairs remain private, even from customer service reps who were also dumbfounded by the change in circumstance.­­­

It is believed that until now requests for customer redemptions have not been sufficient to threaten the firm though they are still braced for a significant amount of money exiting the Total Return Fund and the company at large in the not too distant future. An adviser was quoted as saying,“The company knows that many financial advisers are telling their clients to switch from Total Return to the fund that Gross will run at Janus (NYSE:JNS),”

Gross’s recent history with PIMCO (NYSE:PHK) has been chequered but this does not detract from the fact that he is a star operator on Wall St. with a C.V to match anyone’s. This goes a long way for Janus (NYSE:JNS) in building confidence in his arrival and his long term performance is being used as evidence in accordance with regulatory guidelines.

Janus (NYSE:JNS)’s stock increased significantly once the new of Gross’s arrival hit the trading floor, which seemed to have a negative effect on Allianz’s stock which fell sharply. Changes were also observed in the prices of government yields which began to drop off as speculation increased that investors would withdraw from the Total Return Fund leading management to forfeit their positions.

PIMCO (NYSE:PHK) is putting out the word that it has enough liquidity to absorb this recent trauma and meet any redemtions with comfort. Gross had prepared the company by fortifying the funds cash reserve into tens of billions in preparation for raises in interest rates and the potential for bond prices dropping off as well as the fallout from his departure. No comment from Gross has been sourced since his departure. There is still a nervousness in SEO circles within PIMCO (NYSE:PHK) due to uncertainty at how a new management structure, which will include a team dedicated to the Total Return Fund, will be received in light of Gross’s departure.

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