UK – The UK Charities Aid Foundation has replaced Deutsche Asset Management, manager of its two biggest collective investment schemes worth a total of £500m (€751m), with UBS Global Asset Management and Insight Investment.
The change was due to performance issues, the uncertainty about the future of the German bank’s UK asset management arm and the trustees’ keenness to switch to a specialist approach.
“The trustees have looked for a specialist in each area of investment,” Nicholas Rickard, head of business development and client services at the charity’s financial services department, told IPE.
“The trustees, also believed that the performance of the funds would benefit from the changes,” he continued. “Also they have been influenced a little bit by the uncertainty surrounding Deutsche Bank’s plans for DeAM.
A future owner of the business might not have experience of managing charity assets, Rickard said.
He said the foundation has three Common Investment Funds, which are investment vehicles only open to charities in England and Wales.
The charity, helped by Watson Wyatt, awarded UBS the £350m UK equity growth fund mandate while the £150m bond income fund went to Insight, the asset manager of the HBOS group.
Four managers had been considered in the last phase of the selection for each mandate.
Rickard said foundation has also recently launched a passive UK equity fund currently worth £100m, and managed by Legal & General. This CIF could be worth up to £300m by the end of the year.
UBS and Insight are expected to step in by the end of the year, Rickard explained. And the trustees are considering appointing a transition manager.
The final decision will came after they meet on July 25. Rickard declined to name the manager considered.
As well as the three collective investment schemes, CAF holds cash investments worth about £900m.