co-chief executive and co-chief investment officer Mohamed El-Erian
has weighed in on the reshaping of the U.S. banking industry, saying that more banks will follow Merrill Lynch's
"Merrill Lynch’s recent announcements reveal the path that will be adopted increasingly by the industry: sell non-core businesses (such as Merrill’s stake in Bloomberg), dispose of non-core assets in what will seem to many as distressed sales (selling the CDO portfolios to Lone Star), and raise highly dilutive capital to bolster core activities," El-Erian wrote in a
column posted on Pimco's Web site.
In his column, El-Erian made no mention of specific banks that will follow the Merrill
model. But in the last couple of months, some banks' names have surfaced as possible sellers of their asset management units.
has reportedly hired an investment bank to
help facilitate the sale of its Allegiant Funds
>The MFWire, July 23, 2008). Fifth Third is also said to be reviewing options for Fifth Third Asset Management. Another name that cropped up as a possible seller of its asset management arm is Key Corp, which owns Victory Capital Management.
Stay ahead of the news ... Sign up for our email alerts now