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Institutional investors tender $14bn in mandates using IPE-Quest

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  • Institutional investors tender $14bn in mandates using IPE-Quest

IPE-QUEST - Institutional investors last year placed nearly $14bn (€9.9bn) worth of manager searches with IPE's in-house tender facility IPE-Quest.

After a slight decline in the overall value of searches in 2010, last year saw a 12.5% increase to $13.7bn in the assets pension funds, consultants and other investors sought to place using Quest - with well over half of all mandates exceeding $100m.

Commenting on the searches placed, IPE-Quest manager Jayna Vishram said: "In terms of manager searches, last year was a year of two halves, with the proportion of searches in the first seven months coming to 79% of the total for the year."

She added that the ongoing fallout of the euro-zone crisis had deterred many investors from putting mandates out to tender between August and December, with a steady recovery in January this year.

However, despite the economic climate, 40% of searches were in the $100m-300m bracket, while 9% ranged between $500m and $2.5bn.

One client last year used Quest to find a manager for a €2bn global currency overlay, while May saw the service used for a €1bn liability-driven investment mandate.

The overwhelming majority of searches were conducted by pension funds - accounting for just over half (53%) of business last year, with Vishram pointing out that, of the 26% of searches placed by consultants, many were on behalf of pension funds.

Year on year, this level of consultant usage meant a 9 percentage point increase in the number of searches placed by consultants.

The remaining searches were placed by multi-managers and insurance companies, claiming 8% and 11%, respectively, while 4% of last year's search activity came from treasury departments. 

"We are very pleased to see the interest from treasury departments," Vishram added.

Quest has proven most popular in Switzerland, with institutional clients in the country accounting for 35% of business last year, followed by the Nordic countries, claiming 28%.

The remaining large European pension markets of the Netherlands (17%), Germany (8%) and the UK (4%) accounted for almost all remaining activity.

Since it was launched 12 years ago, Quest has conduced searches valued at more than $120bn, with 2009 seeing activity worth $14.5bn.

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