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Nedlloyd pension fund credits active management for 2015 performance

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The €1.4bn pension fund of shipping company Nedlloyd has reported a 4.7% return for 2015, attributing the performance chiefly to the active management of its equity holdings.

Frans Dooren, the scheme’s director, said the pension fund’s equity allocation – comprising one-third of its 53% return portfolio – returned 10.4%, outperforming its benchmark by 3.8 percentage points.

He added that, over the last five years, the pension fund had outperformed its benchmark by 1.8 percentage points on average.

Dooren said the scheme’s overall return outperformed the benchmark by 1.9 percentage points. 

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The pension fund’s return portfolio returned 7.9% in total, with private equity, real estate and credit returning 20.2%, 5.6% and -1.6%, respectively.

Dooren attributed the performance of the private equity holdings to the portfolio’s maturation.

“Companies we invested in a decade ago are now being sold and have increased in value,” he added.

The scheme’s 47% matching portfolio, consisting of government bonds, swaptions and liquidities, returned 1.3%.

“This was largely thanks to the divestment of our €75m swaptions portfolio in February,” said Dooren, adding that the pension fund incurred a 0.3% loss on its government bonds.

The Nedlloyds Pensioenfonds finished 2015 with a policy funding of 116.7%, which enabled it to grant its pensioners and deferred participants an indexation of 0.35%.

In other news, the €3bn pension fund of technical research institute TNO returned 2.6% last year, generating positive results on all of its asset classes.

Equity, fixed income and mortgages returned 8.2%, 0.6% and 6.4%, respectively, while real estate and private equity returned 7.7% and 15.3%.

The pension fund said its overall annual return included a 0.6% return on its interest hedge, as well as a 1.5% loss on its 50% hedge of the main currencies.

Hans de Ruiter, the scheme’s CIO, said the board decided to reduce the interest hedge from 50% to 40% at year-end, as the 30-year swap rate hit the preset trigger level of 1.5% as part of its dynamic hedging policy.

As at the end of December, the TNO scheme had a policy coverage rate of 111.7%.

The pension fund recently announced that it would grant an indexation of 0.05%.

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