Volkswagen scheme in €1.4bn portfolio transition

GERMANY – State Street Global Markets says it has completed a €1.4bn portfolio transition for the Volkswagen Pension Fund.

The move followed what it termed a “recent change to Volkswagen's asset allocation and asset management strategies”.

"State Street worked together with us to understand the complex facets involved in our portfolio restructuring," said Albrecht Möhle, board member of Volkswagen Pension Trust. "We were pleased with the seamless transition of our fund."

State Street has been providing custody and accounting services for the German carmaker since 1997.

The transition involved a move to a masterfund and a “simultaneous multi-asset class restructuring” of the portfolio with the appointment of a number of specialist managers, including an overlay mandate.

"With the increased scrutiny on trading costs, pension funds continue to recognize the value that an experienced transition manager can bring to the investment process," said Lachlan French, head of transition management for State Street in Europe.

State Street completed more than 800 transitions globally in 2004 comprising approximately €250bn of assets.

In July the trust named Josef-Fidelis Senn as its new chief executive. He replaced Helmuth Schuster, who resigned amid a bribery and sex scandal.