Flemish regional television company Vlaamse Radio en Televisie (VRT) is weighing up applications in its search for investment managers for four new portfolios which make up its pension fund.

The Bfr8bn ($216m) pension fund will include a Bfr3.92bn portfolio specialising in EMU bonds, with up to 5% in non-EMU bonds, two actively managed portfolios of EMU equities worth Bfr1.4bn each and a passively managed non-EMU equities portfolio worth Bfr1.3bn.

The new structure of the fund will come into being on July 1. The fund, created at the beginning of the year following privatisation with Bfr1.8bn funding by the government, is currently under transitional management.

VRT will be ahead of the pack, using the euro rather than the Belgian franc as its domestic benchmark from July. There will be no purely domestic category of asset in its portfolio make up. We have chosen Europe as one," says Hugo de Vreese, chief executive of VRT's pension fund.

The fund can cash in on the fact it is just starting up now, by taking on the euro as its domestic benchmark, avoiding the costs many funds will incur when changing when the euro is actually introduced in 1999.

De Vreese hopes the tender will result in increased returns on assets. Investment aims have been set and benchmarks will be announced to the candidates shortly, he says.

The reponse to the tender has been good, with applicants from Belgium, France, the UK, the US and other major countries, says Fabian de Bilderling, consultant at Watson Wyatt who are handling the tender. Applications had to be received by mid-April, and a final decision will be made in July.

VRT may well appoint foreign investment managers for its pension fund, de Vreese says. Transitional managers are State Street, and local banks Generale Bank and Kredietbank. "But that is of no relevance to the decision," he says. But because of the specialist nature of the portfolios, de Vreese thinks it unlikely one manager will win more than one mandate. Rachel Fixsen"