June 5 (Bloomberg) -- For Pacific Investment Management Co.’s Jeremie Banet, the lure of French food has outweighed his ambition to beat the bond market.
The 36-year-old fund manager who specializes in inflation- protected bonds is leaving June 10 to start a food-truck business in Los Angeles and Orange County. Banet is exiting the Newport Beach, California-based firm on good terms after a “change of heart,” he said yesterday in a telephone interview. Banet, who joined Pimco in 2011, said he will sell croque monsieurs, grilled ham-and-cheese sandwiches typical to French bistros and cafes.
Banet, who is French, joined Pimco in mid-2011 after a career trading inflation-linked investments at Nomura Securities Co. and BNP Paribas SA. He is on Pimco’s real return team, which specializes in investments that shield investors from inflation, such as Treasury Inflation-Protected Securities, commodity indexes and real estate.
“I would like to thank Jeremie for his contributions to Pimco’s clients and wish him the very best in this next phase of his career,” Mihir Worah, head of the real return and multiasset teams, said in an e-mail.
The $15.4 billion Pimco Real Return Fund, led by Worah, one of Pimco’s six deputy chief investment officers, has returned 5 percent this year, better than 84 percent of peers, according to data compiled by Bloomberg. In the past five years, its returns averaging 6.4 percent annually beat 96 percent of similarly managed funds.
Pimco, led by Bill Gross, put the deputy CIO team in place this year as former Chief Executive Officer Mohamed El-Erian’s resignation triggered the biggest management shakeup in its history. Pimco, a unit of Munich insurer Allianz SE, manages about $1.9 trillion in assets.
The Real Return fund benefited this year as TIPS rebounded, a bright spot for Pimco, which has struggled with lackluster performance at its main fund and client redemptions.
Worah supplements TIPS with a mix of assets including corporate bonds and emerging-market currencies, giving him more flexibility than some of his competitors. The fund is required to have at least 80 percent of its money in inflation-protected debt. Worah said in an April interview that he had about 90 percent in TIPS because he was convinced the market still underestimated prospects for inflation.
Banet holds a master’s degree in applied economics and a bachelor’s degree from Paris Dauphine University. He said his family has a history in the food business. Banet’s grandmother owned and edited culinary magazine Cuisine et Vins de France in the 1950s and 1960s, he said.
Los Angeles has become a hotbed for food trucks serving multi-ethnic and gourmet cuisine. In his autobiography, “L.A. Son: My Life, My City, My Food,” Roy Choi, a Korean-American classically trained chef, described how he drove his career to new heights by starting a food truck where he prepared a blend of Asian and Mexican cuisine.
“Chef,” a movie about a Los Angeles chef who loses his restaurant job and starts a food-truck business to reclaim his creative promise, starring Jon Favreau, Robert Downey Jr. and Scarlett Johansson, is expanding to wide release this weekend.
Recipes and techniques for making croque monsieur abound, with popular versions involving a combination of ham, Gruyere or Emmental cheese and a white sauce on buttered toasted bread. A croque madame typically adds a fried or poached egg on top.
The area’s gourmet food-truck scene exploded in November 2008 after the real estate crash left thousands of idled vehicles that had served construction work sites, said Matt Geller, chief executive officer of the Southern California Mobile Food Vendors Association.
Truck owners are free to experiment with novel types of cuisine for less money than it costs to start a restaurant and Los Angeles County, with 3,000 permitted food trucks, has a regulatory environment that fosters mobile service, he said.
“Better regulations allow us to grow in a way that’s market-driven,” Geller said in a telephone interview.
--With assistance from John Gittelsohn in Los Angeles and Sree Vidya Bhaktavatsalam in Boston.