AP2 plans “manager of managers” role
SWEDEN – The second Swedish national pension fund AP2 says its strategy is to make use external managers’ expertise and become a “manager of managers”.
“During the spring, the Fund has continued to develop and implement its strategy pf managing a significant proportion of its assets by co-opting the expertise of external investment managers,” Andra AP-fonden said.
“The plan is to become a highly competent ‘manager of managers’.”
The fund said that it has completed negotiations “concerning a number of external asset management mandates, Swedish and international”. It added that this signified the “culmination of a comprehensive evaluation process”.
It also said that it has made the changes needed to transfer its global custody to State Street, following a contract signed at the end of 2002.
AP2 says it is becoming more active in corporate governance issues, pointing to the fact that it participated in more than 40 Swedish annual general meetings in the spring. It is trialling a voting system for foreign companies’ AGMs.
The comments come as AP2 disclosed that it made a total return on its invested assets of seven percent in the first half of 2003. Its assets are now 126.7 billion crowns (13.8 billion euros), a rise of 9.6 billion crowns compared to the end of 2002.
“The favourable result may largely be attributed to the positive development of the global stock market, a trend which has furthermore continued and strengthened following the close of the report period,” said chief executive Lars Idermark.
“From the perspective of the Second AP Fund, the decision to maintain the strategic focus that had been determined, involving a relatively high ratio of equities in the asset portfolio, proved to be the correct choice.”
AP2’s sister funds have all recently disclosed their first-half returns. AP1 returned 6.6%, AP3 6.9% and AP4 6.7%.