Border to Coast Pensions Partnership, a UK public sector pension pool, has announced it is on track to deliver £250m (€292m) of savings as it released its third annual report today.
The pool, which supports its partner funds on £35.4bn of their £55bn of assets – directly managing £24.7bn and providing advice on £10.7bn – is set to deliver over £110m of cumulative net savings within the first decade of pooling and over £250m in the first 15 years.
Chris Hitchen, chair of Border to Coast, said: “We were created to make a difference – and we are already delivering for and behalf our partner funds. While we are only three years into our initial five-year strategic plan, given the challenges of setting up a FCA regulated asset manager and managing through COVID-19, what we have achieved together with our Partner Funds is truly impressive.”
The annual report highlights how the pool is delivering cost savings; supporting the diversification of risk from improved access to a wider range of assets, including infrastructure; and, in having a stronger voice, is increasing the influence of its partner funds as active investors.
Over the past year, Border to Coast has deepened and expanded its capabilities which has enabled it to add greater value – such as its first co-investment in Sleaford Renewable Energy Plant, which can generate electricity for 65,000 homes, saving 50,000 tonnes of CO2 per annum.
Hitchen added: “With our collective size, we are beginning to open up investment opportunities which some of our partner funds were unable to access on an individual basis. Indeed, this year we participated in our first co-investment opportunity in green energy. Historically only within reach for some, such co-investments are now available to all our partner funds and help reduce the cost of investing in private markets.”
Since its establishment in 2018 Border to Coast has launched 10 investment opportunities: five equity funds, two fixed income and private markets opportunities in private equity, infrastructure and private credit.
It continues to develop investment propositions, obtaining Financial Conduct Authority (FCA) approval for its multi-asset credit fund, due to launch later in 2021, and working with partner funds to deliver further equity, private market and real estate capabilities.
CEO Rachel Elwell said: “Some of our partner funds are among the largest and most sophisticated investors in the UK but, through collective endeavour, we are still delivering significant cost savings across the pool – for example in a single transaction we saved two partner funds £3.5m.”
She acknowledged that while cost savings are important, Border to Coast is driving greater value in a range of other areas.
“With our expert in house team, we are opening new investment opportunities for our partner funds, particularly in private markets. Having already deployed £3bn, we are regarded as a partner of choice in this sector,” she added.