PIMCO Settles Suit, Promotes Emerging-Markets Bond Skipper

PIMCO announced that it has settled a class-action lawsuit relating to the firm's trading of futures contracts in 2005. The suit involved accusations that PIMCO helped to improperly enrich its clients, but the $92 million settlement is being paid solely out of PIMCO coffers from reserves it set aside during the last three years. PIMCO funds will be unaffected, and the firm does not expect the statement will affect its future financial performance, compensation for any staff, or any future plans for growth.

Ramin Toloui will take over as lead manager of  PIMCO Emerging Markets Bond  on Jan. 1. Toloui, who is a comanager with CEO Mohamed El-Erian on  PIMCO Global Advantage Strategy (PSAIX), will replace Curtis Mewbourne, who has managed the fund since April 2009. Mewbourne is moving to New York to oversee PIMCO's growing stable of portfolio managers there. While Mewbourne will continue running  PIMCO Diversified Income  (PDIIX) (for which he is nominated to be named Morningstar Fixed-Income Fund Manager of the Year) and  PIMCO Floating Income (PFIIX), his new responsibilities are forcing him to shed his role with Emerging Markets Bond.

This is a significant promotion for Toloui, who has only been with the firm since 2006. That said, he's not new to emerging markets. He currently manages about $10 billion in institutional and separate emerging-market accounts. Before joining PIMCO, Toloui worked for seven years in the U.S. Treasury, where he helped intervene in debt crises in Argentina and Turkey.

Toloui will also be the co-head of PIMCO's overall emerging-markets effort with Michael Gomez, who runs  PIMCO Developing Local Markets  and  PIMCO Emerging Local Bond (PELBX). As indicated by their portfolio responsibilities, Toloui will focus on so-called "hard-currency" bonds (such as those denominated in the U.S. dollar, euro, or other developed currencies), while Gomez will stick mostly to local-currency debt.

DWS Brings Equities and Fixed Income Under One CIO
On Dec. 29, DWS announced changes in the firm's management that unites equities and fixed income under a single CIO.

Klaus Kaldemorgen is stepping down as equity CIO (a role he's held since 2005) to concentrate exclusively on investment management, including new absolute-return funds. He started at DWS in 1982. Asoka Woehrmann, fixed-income CIO, will retain that role and take over equity CIO responsibilities, as well.

Additionally, Wolfgang Matis will be appointed as speaker of the management board of DWS Investment GmbH and global CEO of DWS. He will report to Kevin Parker, Deutsche Asset Management's global head. (DWS is the mutual fund arm of Deutsche Asset Management.)

Finally, Ingo Gefeke--the firm's global head of distribution and product management--is stepping down from the DWS board of management and will take on a new role with Deutsche Asset Management in New York. Also, Axel Schwarzer, on the DWS board of management and vice chairman of Deutsche Asset Management, is leaving.

Neuberger Berman Founder Passes Away
Legendary value investor and avid art collector Roy R. Neuberger passed away recently at the age of 107. He founded mutual fund firm Neuberger Berman in 1939.

Wells Fargo Announces Manager Changes
Wells Fargo recently announced a number of management changes.

Walter McCormick and Emory Sanders, who managed Wells Fargo Advantage Classic Value  and  Wells Fargo Advantage Core Equity , have left Wells Capital Management. James Tringas will take over as the sole manager on Classic Value and Ann Miletti will run Core Equity. Miletti currently runs the well-performing  Wells Fargo Advantage Opportunity (SOPVX) and  Wells Fargo Advantage Common Stock  funds and she will remain on those offerings.

Senior research analyst Bruce R. Johns is now the comanager of Wells Fargo Advantage Pennsylvania Tax-Free (EKVAX) with Robert Miller, who has been running the fund solo since November 2009.

Finally, Michael C. Bray will become a comanager with Christopher Kauffman of  Wells Fargo Advantage Adjustable Rate Government (ESAAX), replacing Richard Applebach. Bray also helps run the  Wells Fargo Advantage Government Securities  and Wells Fargo Advantage Income Plus (STYAX) funds.

Etc.
Eve Guernsey, who retired as CEO of investment management Americas at J.P. Morgan Asset Management in August 2010, hasn't stayed idle for long. She is filling the board seat left vacant at Lord Abbett by the retirement of William H.T. Bush.

Aston is launching another new offering subadvised by River Road. It will be a a long-short fund managed by Matthew Moran and Greg Deuser. The expense ratio for the N shares will be 1.95% after fee waivers and expense reimbursements, above the median for no-load long-short funds.

Munder Energy  and Munder Healthcare  are slated to be merged into Munder Growth Opportunities (MNNAX) pending a shareholder vote on Feb. 25, 2011. These are the last of the firm's sector funds. The once-huge Munder Netnet (which went over the $10 billion mark in the dot-com craze) was merged away a couple of years ago.

Daphne Car joined the portfolio-management team of Lord Abbett California Tax-Free Income (LCFIX). Car comanages the fund with Daniel Solender.

Philip Herman joined the portfolio-management team of Lord Abbett New Jersey Tax-Free Income (LANJX) and Lord Abbett New York Tax-Free Income (LANYX). The funds are now comanaged by Herman and Solender.

Arthur Weise joined the portfolio-management team of  Lord Abbett Developing Growth (LAGWX). The fund is now comanaged by Weise and F. Thomas O'Halloran.

WestEnd Advisors replaced Analytic Investors as a subadviser of  SEI Institutional Managed Trust Large Cap (SLGAX). Robert Pharr manages WestEnd Advisors' sleeve of the fund.

William Blair & Company was added as a subadviser to SEI Institutional Managed Trust Small Cap (SLLAX), SEI Institutional Managed Small Cap Value (SESVX), and SEI Institutional Managed Tax-Managed Small Cap (STMSX).

Lee Munder Investments is no longer a subadviser for SEI Institutional Managed Small Cap Growth (SSCGX).

Mutual fund analysts Kevin McDevitt, Rob Wherry, Kathryn Young, and Kailin Liu contributed to this report.

This report has been updated since its original publication to include information about PIMCO's settlement.