Pimco Considers Pakistani Bond Sale

Pacific Investment Management Co., which manages the world’s biggest bond fund, is considering buying Pakistani bonds being sold this week for its Asian holdings, Pimco fund manager Aaron Low said.

The $500-million sale of five-year, dollar-denominated bonds is Pakistan’s first overseas debt sale since nuclear tests in 1998 brought international sanctions. The sale comes amid signs of improved relations between Pakistan and its nuclear-armed neighbor India, after leaders of the countries met in January.

“Pakistan is a positive reform story,” Low said in a television interview at Bloomberg News in Singapore. “There is obviously some risk on the table, but overall it’s a positive economic recovery.”

The country’s debt rating was raised one level in October by Moody’s Investors Service to B2, five steps below investment grade. Standard & Poor’s in December revised the outlook on Pakistan’s B foreign currency rating to “positive” from “stable.”

Low said Pimco, based in Newport Beach, recommended dollar-denominated corporate bonds in Malaysia and Indonesia.

He also said Pimco owns company bonds issued in Hong Kong and South Korea. He did not name his holdings.