ESB Fund Managers in Dublin has entered into an association agreement with JP Morgan Investment Management in London under which it will manage international equities and bonds on behalf of the Dublin manager's clients.
ESB Fund Managers is a subsidiary of the state-owned Electricity Supply Board and has a contract from the ESB Pension Fund to manage part of its Ir£1.8bn ($2.5bn) in assets. The other main manager to the fund is the Bank of Ireland Asset Management.
The ESB pension fund trustees decided to review its managers some time ago, says ESB FM managing director Michael Phelan. In addition to BIAM and ESB, these included Hill Samuel and New Ireland, which has been acquired by Bank of Ireland.
As a result of the review, ourselves and BIAM were retained and two new managers were appointed: JP Morgan for active management of international securities and Barclays Global Investors for indexed funds."
ESB FM's portfolio of Irish bonds and equities managed for the ESB fund is around Ir£1bn, while BIAM handles purely overseas equities. The EsF fund accounts for a very large proportion of the assets managed by ESB FM, but it has 14 other clients in cash, mixed funds and unit-linked managed funds.
The new arrangement with JP Morgan replaces a similar one that ESB FM had with Hill Samuel to look after non-domestic exposures for its clients. But Phelan says the new set-up will be more effective as JP Morgan will look after all overseas assets, whereas Hill Samuel would have passed non-European elements to other managers."