Pimco hires former TARP chief Kashkari
Neel Kashkari, the first head of the government's $700 billion financial rescue program, will join Pacific Investment Management Co. as a managing director and head of new investment initiatives, the company said Monday.
Pimco, one of the world's largest bond managers and a unit of Germany Allianz, said Kashkari will be based in its Newport Beach, Calif., office.
Kashkari, a former official at Goldman Sachs, was selected by then-Treasury Secretary Henry M. Paulson Jr., a former chairman of Goldman, to run the financial bailout effort in the fall of 2008.
Kashkari stayed on in the early months of the Obama administration to run the Troubled Assets Relief Program. He was replaced in the spring by Herbert M. Allison Jr., who now serves as assistant Treasury secretary for financial stability.
The hire will help cement Pimco's status as one of the firms closest to the Treasury Department and Secretary Timothy F. Geithner. Geithner's calendars from the early months of the Obama administration show multiple contacts with Pimco founder and co-chief investment officer Bill Gross.
While Geithner was president of the Federal Reserve Bank of New York, it awarded Pimco contracts to help manage the response to the financial crisis. Pimco has helped oversee a program that guarantees on assets owned by Citigroup and Bank of America, and helped run a Fed program to buy $1.25 trillion in mortgage bonds, according to the Government Accountability Office.
Kashkari ran some of those programs from his Treasury post.
Spokesmen for Pimco and the Treasury Department did not immediately respond to requests for comment Monday afternoon.
In a Washington Post article Sunday, Kashkari was portrayed as an eager refugee from Washington, now living a secluded life with his wife in a mountainous area of Northern California.
In the story, Kashkari said the $700 billion figure "was a number out of the air," arrived at after Paulson told him Congress wouldn't approve $1 trillion.