Keva to set up transition manager panel
FINLAND - Kuntien eläkevakuutus (Keva), the Finnish Local Government Pensions Institution, is looking to establish a transition manager panel for its €20bn scheme.
The organisation, which is responsible for providing and financing employment pensions for local government officeholders and employees, has issued a tender notice for "potential transition managers" as part of a framework agreement.
Keva stated it expects to appoint four managers to a panel for future asset transitions, and these providers will "partake in call-offs for individual transitions in the future as required".
The framework agreement is set to run for an initial period of four years and the selection process, assisted by Mercer, and will be based on a range of criteria including the number of pension fund transitions carried out by the candidate's European office since July 2007, and the number of worldwide staff and the number based in the European office that spend at least 75% of their time on transition management.
Figures from the latest annual report for 2008 showed Keva has a target asset allocation of 50% in equities, 32% in fixed income, 9% in real estate, 5% in private equity and 2% each in hedge funds and commodities.
However, despite being underweight in equities at the end of the year, at just 36.3%, with 48.7% in fixed income, the pension fund returned -20.6% resulting in the value of the assets falling from €24.2bn to €19.8bn over the year. (See earlier IPE article: Finnish local gov't scheme loses €4.3bn)
The report noted Keva intends to still achieve the target allocation following "a transitional stage in 2009".
Transition manager applicants are required to complete a pre-qualification questionnaire and the deadline for tenders or requests to participate in the process is 3 September 2009, with further information available from Mercer.
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