The NLG1.6bn (e726m) PMA (Pensionfonds Medewerkers Apotheken) pension fund for Dutch pharmacists, based in The Hague, has outsourced almost its entire investment portfolio through an extensive multi-manager structure.
The new multi-manager arrangement has resulted in the appointment of a slew of investment managers to various segregated and mutual fund briefs and follows a recent ALM study, which recommended that the fund up its equity quota by 10% to give an asset mix of 50% equity, 40% bonds and 10% in real estate.
Under the structure the approximately NLG800m equity assets will be split geographically between Europe, US and global mandates.
The European share will be managed by Instituut voor Beleggingsstrategie, DeltaLloyd, ABN AMRO, Kempen and Henderson Investors – with a portion still managed internally.
For US equities the group has appointed T.Rowe Price and Robeco, with a further portion kept in-house.
Fortis Investment Management wins the only global equities brief.
For bonds, around NLG640m will be shared between Lombard Odier, Instituut voor Beleggingsstrategie, DeltaLloyd, ABN AMRO and ING Investment Management .
Real estate funds worth around NLG160m will be split between a number of managers, including AZL Woning and Kantoren, ING Dutch funds (office, residential and retail), Rodamco funds (Europe, North America, UK, Asia and retail Netherlands) and Kempen’s Orange European and global property funds.
Dick Wenting, general manager at the fund, says the multi-manager structure was implemented to enable the fund to get diversification in investment styles, adding: “The reasons for this move are a growing need for performance, consistency of performance and risk management, given a very small investment department with PMA and an investment universe that is growing more internationally and needs more attention – i.e. sectors and credits.”
Wenting says the primary investment target for the managers is a guaranteed return on the invested pension premiums.
He says a guarantee is given for the nominal pensions, against a 3% discount rate regarding the nominal liabilities. The surplus on the return on investments is allocated firstly for the indexation of the liabilities and secondly for a reduction on the premiums, which Wenting says is 40-50% at the moment .