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FRR terminates €331m SGAM mandate (update)

FRANCE - The FRR, the €29bn French Pensions Reserve Fund or Fonds de Reserve Pour Les Retraites, has terminated a €331.5m US mid-cap equities mandate with Société Générale Asset Management subsidiary TCW due to "ongoing unsatisfactory performance" (Updates with SGAM comment).

"The FRR has decided to terminate a management mandate contracted with Société Générale Asset Management (SGAM) due to an ongoing unsatisfactory performance," the fund said in a release today.

It added: "Financial management of the mandate, for US mid-cap equities, had been delegated to Trust Company of the West (TCW), a subsidiary of SGAM.

"Initially funded in November 2004, for a period of five years, the portfolio had total assets of €331.5m on September 30, 2006.

"All transactions related to portfolio termination were successfully completed. A new RFP for the management of the same asset class will be launched in the near future."

SGAM, which took over Los Angeles-based TCW in 2001, said: "The performance of the mandate is positive over the two years we've had it.

"Being a mid-cap strategy we consider that its one that builds up over time. With the term of the mandate to 2009 our investment decisions were justifiable and rational given that. Obviously we respect the FRR's decision."

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