Dutch group SFB in third party business push
NETHERLANDS- SFB Groep, the e20bn Dutch outfit that oversees the Dutch builders’ pension assets, is pushing ahead with marketing itself as a third party provider of asset management and pension fund administration. The group has a five year strategy over which it intends to market its services to third parties including other pension funds and the government.
SFB Groep provided the government with social security administration until 1999 when the latter took back the administration or, as chairman of the SFB board Joep Schouten says: “decided to renationalise social security.”
Schouten explains the strategy: “we had a very large IT capability and a lot of people working here and so the company was too large for the work that remained. We realised that the company was a little too small to continue as it was and we thought it was a good idea to try and grow it in terms of asset management and administration.”
SFB has already had some success and has attracted new clients- last year the painters’ e2bn industry-wide fund employed it to manage some e500m and earlier this year the industry-wide fund for concrete workers joined the group.
SFB says high IT costs and attempts to automate administration will help their cause. “For smaller pension funds it is not very easy to invest large amounts in their IT solutions so there is some trend in consolidation and trying to seek a little help from other companies who specialise in pensionfund and administration,” says Schouten.
Increased scrutiny by the Dutch supervisors has put pressure on Dutch trustees and led small funds to hand their responsibilities including asset management and fund administration over to specialist companies.
SFB will be targeting similar industry wide schemes, especially those with highly mobile jobs and short contracts. The IT and the restaurant and catering industries spring to mind. “We have a lot of experience servicing the building industry and they have traditionally very short contracts.” It will also target those building companies with occupational schemes but who are not members of the industry wide scheme.
As part of the expansion, SFB Groep has employed Jan van Bakel from the asset management and administration company SFS as its new director of asset management. It has also split its asset management operations into real estate, equities and fixed income and aims to raise turnover, operating profit and assets under management by 30% in the next five years.
Other Dutch groups pushing into third party management include MN Services, Schootse Poort, the former administrator for the Philips pension fund, and KLM’s manager, Blue Skies.