Business Briefing

BANKING

Wells Fargo repays TARP bailout funds

Wells Fargo & Co. said it repaid the $25 billion in bailout funds it received from the Treasury Department last fall under the Troubled Asset Relief Program.

As part of its redemption of preferred stock held by the Treasury, Wells Fargo paid accrued dividends, bringing the total dividends it paid to the government to $1.44 billion.

The repayment was made possible in part through Wells Fargo’s recent sale of $12.25 billion in stock to the public.

The Treasury still holds warrants to buy about 110 million shares of its common stock at a price of $34.01 a share. Shares of Wells Fargo closed Wednesday at $26.85.

Separately, Citigroup Inc. said it had repaid as planned its $20 billion in bailout money.

ASSET MANAGEMENT

Pimco bond fund is biggest ever

Pimco Total Return Fund became the biggest mutual fund in the industry’s history as its assets reached $202.5 billion on Dec. 17.

The bond fund is managed by Bill Gross and Mohamed El-Erian, co-chief investment officers of Pacific Investment Management Co. in Newport Beach.

The record for fund size had been $202.3 billion, set by Growth Fund of America in 2007, according to fund tracker Morningstar Inc. The stock fund, managed by Los Angeles-based Capital Group Cos., now has about $153 billion.

Pimco Total Return received $47 billion in net inflows this year through Nov. 30, the most of any U.S. mutual fund, Morningstar said. It has outperformed 99% of its rival funds over the last five years, according to Bloomberg. The fund rose 4.8% in 2008 as the Standard & Poor’s 500 index fell 38%.

DoubleLine gets OK as advisor

Los Angeles money management firm DoubleLine, which was launched this month by star bond fund manager Jeffrey Gundlach, said its registration as an investment advisor was approved by the Securities and Exchange Commission.

The approval paves the way for Gundlach to attract money from institutional investors, a small number of which he has already been guiding as an unregistered advisor.

Gundlach, considered one of Wall Street’s sharpest investors in mortgage-backed bonds, was chief investment officer at L.A. investment giant TCW Group until the $110-billion-asset firm ousted him Dec. 4 after an internal power struggle.

More than 40 people on Gundlach’s 65-member bond team at TCW have since followed him to DoubleLine, which began operations Dec. 14 with support from another L.A. financial titan, Oaktree Capital Management.

COMPENSATION

Law firms slash first-year bonuses

Law firms including Cravath, Swaine & Moore and Skadden, Arps, Slate, Meagher & Flom cut year-end bonuses for first-year lawyers by as much as 57% in a bid to keep client costs down and ride out a recession that has forced structural changes in the industry.

Bonuses dropped for first-year associates at many top-tier New York firms while staying the same or increasing for more experienced associates. Bonus reductions, along with overall pay cuts, signal a diminished role for junior lawyers at the larger U.S. firms, consultant Bruce MacEwen said

SAFETY

Disney World cited after fatality

Walt Disney Co.’s Walt Disney World was cited by the Occupational Safety and Health Administration for safety violations after the death of a monorail driver in a July collision at the Florida theme park.

The U.S. safety agency said it proposed $44,000 in penalties against the company, including $7,000 for a serious violation related to the fatality.

-- times staff and wire reports