DENMARK - Pension provider PenSam has awarded a fund administration contract to Nykredit Portfolio Administration (NPA) in a deal involving DKK15.3bn (€2bn) of assets.

The award sees NPA take over from the current service supplier Nordea Invest Fund Management.

Under the contract, NPA will act as fund administrator for PenSam's fund wrapper subsidiary PenSam Invest, starting from 1 June.

Helen Kobæk, managing director of PenSam and chairman of PenSam Invest said: "PenSam carried out a thorough bid process, in which we evaluated the possibilities of different suppliers delivering professional administration that supports our investment strategy.

"Against that background, we chose Nykredit Portfolio Administration for the task," she said.

Jim Isager Larsen, director at Nykredit Portfolio Adminstration, added: "PenSam is one of the leading institutional investors in Denmark, so we are very pleased to have won the contract."

In principle, the contract is of unlimited maturity, he said, but added that PenSam is expected to review it biannually.

Assets managed within PenSam Invest comprise the bulk of PenSam's externally managed listed assets, Larsen said. PenSam has total investments of DKK80bn.

In other news, PensionDanmark reported an investment return of 2.6% in the first quarter, and described the result as robust.

The labour-market pension fund said its cautious investment strategy was continuing to yield good results.

Managing director Torben Möger Pedersen said: "Even though the year began relatively positively, the uncertainty about the outcome of the European debt crisis increased again and we saw big falls in equities and bonds."

But it was the pension fund's task to ensure a robust and positive return for members, come rain or shine, he said.

"We managed that particularly well in a difficult 2011, with a return of between eight and 12%, and we achieved a satisfactory return in the first quarter of 2012 as well," he added.

The investment return compared with the 2011 full-year return of 10.5% and a loss of 0.7% in last year's first quarter.

Contributions were unchanged over the first three months of 2011, at DKK2.5bn. Total assets stood at DKK125bn at the end of March, up from DKK122bn at the end of last year.

However, the scheme was able to reduce administrative costs  to an annual DKK312 per member, down from DKK352 at the end of 2011, while membership rose slightly to 622,000 from 618,000 at the end of last year.