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IPE special report May 2018

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Metalektro awards emerging debt to Ashmore

NETHERLANDS – The 12 billion-euro fund for metal industry workers, Bedrijfstakpensioenfonds Metalektro, or PME, has awarded an emerging market debt mandate to Ashmore Investment Management worth 250 million dollars (230 million euros).

"Emerging market debt and US high yield are an important diversification for us,” said Roland van den Brink, Metalektro’s managing director of investments.

He said the asset class was interesting as it is “counter-cyclical” to the business cycle – enabling “strong returns when other markets are weak”.

“Our allocation should help increase overall returns without increasing overall risk,” he said. “In addition the active management of these assets helps me to achieve my target of earning 40 basis points net of all costs through active management whilst keeping tracking error around two percent.”

The mandate is being managed as a separate account, Ashmore said. Mark Coombs, managing director of Ashmore IM, said: “The demand for emerging debt from pension funds and other institutional investors has been gradually increasing over the last year and a half, and the asset class is now widely seen as a long term strategic investment rather than as a tactical allocation.

The Ashmore Group has more than five billion dollars under management and administration. Meanwhile it has emerged that Metalektro has raised its pension contributions by three percent to 23% of salary.

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