Mandate roundup: Pension Protection Fund, Hertfordshire, LGIM
EUROPE - The UK Pension Protection Fund (PPF) is looking to appoint a panel of specialist bond managers to access a wider range of strategies for its growing portfolio.
The PPF, which compensates members of defined benefit schemes following sponsor insolvency, now manages more than £9bn (€10.8bn) in assets.
The PPF said: “The new panel will complement the fund’s existing managers and give the PPF the flexibility to access a broader range of bond strategies.”
As much as 70% of the fund’s assets are allocated to cash and bond strategies, it said.
These strategies aim for above-LIBOR returns and help the PPF manage money in line with its low-risk philosophy, it said.
Whereas in the past the PPF has focused mainly on the global sovereign market, it said the new specialist panel would give it greater flexibility and help deliver attractive returns throughout the economic cycle.
It added: “The PPF is looking particularly for managers with expertise in absolute return strategies, asset-backed securities and emerging market debt.”
The existing managers - Goldman Sachs Asset Management, Mondrian, PIMCO and Rogge - will continue managing money for the PPF under the terms of their current contracts, the fund said.
Contracts for the new bond managers will be initially for four years, with two renewals lasting for a term of two years.
In other news, the Hertfordshire County Council Pension Fund has awarded Legal & General Investment Management (L&G) an investment management services mandate.
The mandate, worth £300m, has been awarded for a period of five years.
The UK pension fund cited LGIM’s fees, index tracking and liability-driven investment strategy.