Bill Gross, manager of the world's largest bond fund, guaranteed $760 million of debt issued by American International Group Inc. as of June 30, obligations that may prove costly if the insurer fails to stay afloat.
Pimco Total Return Fund, which oversees $132 billion in assets, backed the bonds by selling credit default swaps to investors that pay off if AIG defaults, according to a filing with the U.S. Securities and Exchange Commission last month. The fund had sold insurance on $7.7 billion of bonds, including $4.8 billion issued by financial-services companies, as of the end of June...MORE
Tuesday, September 16, 2008
Bill Gross's Fund Guaranteed $760 Million of AIG Debt