US asset manager has loaned $10bn to Gulf investors during war

Pacific Investment Management Company (Pimco), a US-based asset manager, has reportedly provided more than $10 billion to state-backed and government borrowers in the GCC since the US-Israeli war with Iran started.

With Gulf economies already feeling the effects of the war, the $2.3 trillion investment company has emerged as the major buyer of privately placed bonds issued by the governments of Abu Dhabi, Qatar and Kuwait, as well as by the state-run Qatar National Bank, Bloomberg reported, citing unidentified sources. 

Pimco also joined other investors in several placements that increased the size of existing Abu Dhabi bonds by a combined $2.5 billion, the report said.

Regional borrowers have raised more than $13 billion since February 28 through privately placed bonds, with Pimco accounting for a majority of that financing.

Pimco intends to take a long-term view on these investments, the report said.  

Last week the US was considering providing a currency swap to the UAE as part of support for its Gulf ally, President Donald Trump said in a television interview.

The UAE central bank informally requested a swap arrangement that would enable it to exchange dirhams for dollars should the Iran war cause longer-term economic challenges.

Further reading:

• Trump says US mulling UAE currency swap
• UAE moots currency swap with US if Iran impact worsens
• Expected economic rebound sends Gulf bonds rallying