UK - Northamptonshire County Council is tendering two new investment mandates for global equities and bonds, following a review of its £866m (€1.01bn) pension fund's investment strategy.
The council's pension fund committee agreed some changes to the asset allocation of the fund in March, but while it decided to make "no immediate change to the overall level of equity allocation" officials agreed to reduce the UK equity allocation.
This reduction, which follows the dismissal of Martin Currie as a UK equities manager, would then be used to increase the overseas equity allocation - including UK - "in conjunction with a move to market capitalisation and passive currency hedging programme".
The three- to five-year passive global equity mandate now being offered by Northamptonshire is valued at £130m, and has a requirement for "passive currency hedging and assistance with rebalancing".
The tender notice therefore said the successful manager may be required to hold assets on a short- to medium-term basis - for example 12 months - "following the termination of any of the fund's active managers in the future, until a replacement is found".
The council is also touting a £50m UK specialist bond mandate, following the decision in March to terminate the hedge fund portfolio run by Partners Group and to reallocate the funds to bonds.
The contract is for a rolling period of between three to five years, and the initial value of the assets under management is £50m, although the tender notice admitted "this may increase over time and as such candidates should have the capacity and expertise to potentially take the role of sole bond manager to the fund over a period of time, which at current asset values would equate to a mandate of approximately £170m", or 20% of the fund.
Figures from the pension fund's draft statement of accounts for 2008/09 meanwhile showed the pension scheme lost almost £200m in value in the year to 31 March 2009 from £1.06bn to £866.5m, as the net loss on investments was £225m.
The draft report also showed the asset allocation at the end of March 2009 comprised 20.9% in government securities and deposits; 34.7% in UK equities; 31.3% in global equities; 5.6% in property unit trusts and 6.1% in hedge funds and private equities with the remainder spread across cash deposits and short-term loans.
Applications for the two investment manager roles should be submitted by 14 September 2009, with further information and details on how to apply available through the eSourcing portal Bravo Solution.
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