- Pimco, AllianceBernstein have boosted holdings since hurricane
- Once big buyers, mutual funds sold when fiscal crisis worsened
Traditional bond buyers are going back to Puerto Rico.
After shunning the U.S. territory for much of the past six years, municipal-bond mutual funds are again buying the government’s debt as it recovers from the 2017 hurricane and inches closer to winning a potential court approval to restructure more than $17 billion of sales-tax-backed debt, a major step in its record-setting bankruptcy.
Pacific Investment Management Co. held about $506 million of commonwealth securities as of Sept. 30, nearly 10 times the $52 million held the month before Hurricane Maria, according to data compiled by Bloomberg. AllianceBernstein LP increased its exposure to $347 million, as of Nov. 30, up from $53 million in August 2017. Capital Group and Massachusetts Financial Services Co. increased their exposure by nearly 50 percent.
Bloomberg Markets
By Michelle Kaske
January 31, 2019, 7:19 AM MST