UK - Islington Council has appointed Standard Life Investments to run a UK active bond mandate worth up to £150m (€175m) to its local government pension fund.
The council initiated a search for a bond manager in March 2008 following a review of its investment strategy, and tendered an active UK mandate valued at between £100-150m. (See earlier IPE article: Islington seeks managers and eyes GTAA after review)
In the original tender, it was suggested the portfolio could be split between one or more managers, however Islington revealed its pension sub-committee had resolved to appoint Standard Life "as the manager for the whole bond portfolio subject to conditions and agreeing the fund management agreements with the investor".
The tender also proposed a benchmark of 30% in FTSE Actuaries Gov't Securities UK Gilts index, along with 50% iBoxx All Stocks Corporate Bonds index and 20% in FTSE Actuaries Gov't Securities Index-linked index for investments of greater than five years.
Islington pension scheme, valued at £689m in March 2008, was given a proposed optimal investment strategy in November 2007 which included an allocation to property and private equity and a marginally reduced allocation to equity.
As part of this overhaul, the fund recently appointed two global equity mangers to run a mandate valued at up to £250m, however the council admitted at a committee meeting earlier this month that a UK and global property tender was still being finalised. (See earlier IPE article: Islington splits global equity mandate)
The search was supposed to have been started in March, however the tender documents "had to be updated to reflect new procurement regulations and processes". Instead, the council is now "accelerating" the process and the tender notice is expected to be released this month carrying a closing date for July, so an appointment might be agreed in October 2009.
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