LGPS Central, the asset pooling vehicle for eight local government pension schemes (LGPS) based in England’s Midlands, has launched a global investment grade corporate bond fund in order to meet its partner funds’ needs.
The pool announced the new fund brings together £1.2bn (€1.3bn) of partner fund assets under management, with the initial investors being Derbyshire Pension Fund, Nottinghamshire Pension Fund, Staffordshire Pension Fund and Worcestershire Pension Fund.
Gordon Ross, investment director for fixed income and deputy chief financial officer, said: “We believe this fund will help ensure our partner funds’ investment objectives are met and allow for important portfolio diversification.”
He said the transition team “has, in particular, worked together extremely effectively during this period of heightened market volatility”.
The pool has selected Fidelity International and Neuberger Berman out of a group of more than 70 asset managers that expressed an initial interest in tendering for the mandate, it said.
Each fund manager will equally share the value of the mandate, it said, adding that the assets have already been transitioned to both firms with BlackRock as transition manager.
Late last year, the pool was looking for global active emerging market debt (EMD) managers to run a fund worth around £900m.
A spokesman for the pool told IPE: “We’re in the final stages of the EMD search and hope to be in a position to announce the managers in the near future,” adding that there is no definite timeline.
LGPS Central manages the pooled assets for Cheshire, Derbyshire, Leicestershire, Nottinghamshire, Shropshire, Staffordshire, Worcestershire and West Midlands pension schemes, with approximately £45bn of collective investment assets.
LGPS Central, one of eight LGPS asset pools in England and Wales, has around £20bn of assets under management and advice.