2016

October 17, 2016

Organizational changes at PIMCO

Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the fund listed below, which is established as a segregated fund in accordance with the Insurance Companies Act (Canada).

PIMCO has announced that effective November 1, 2016, Emmanuel Roman will be named Chief Executive Officer (CEO). Mr. Roman will replace Douglas Hodge, who was named CEO in early 2014 following the abrupt resignation of Mohamed El-Erian.

Mr. Roman was previously the CEO of Man Group Plc, a UK hedge fund manager. Mr. Hodge will remain at PIMCO in an advisory role having been with the firm for 27 years.

SunINsight Watch List
As a result of the high profile personnel changes noted above, Sun Life Financial will keep the PIMCO Canada Canadian Core PLUS Bond Fund (the Fund) on its Watch List in the Additional Monitoring category.

While Sun Life is comfortable with Mr. Roman's qualifications, we continue to monitor PIMCO following the aforementioned departure of Mr. El-Erian, former CEO and co-Chief Investment Officer, and the departure of Bill Gross, sole CIO following Mr. El-Erian's departure and co-founder of PIMCO, which both occurred in 2014.

We do not have material concerns with the Fund in the short term given that PIMCO's investment strategies are derived from an overall "house view" or model portfolio derived from the firm's Investment Committee and annual secular forum; individual portfolio managers do not have discretion to deviate substantially from these views. We expect this philosophy will remain anchored in these firm-wide views. Furthermore, the management team of PIMCO's Canadian Fixed Income funds has been stable in recent years without any notable departures. We are confident that the current team has the knowledge and resources to continue to effectively manage the Fund.

Questions?
Please contact your Sun Life Financial Group Retirement Services representative.