The National Pensions Reserve Fund (NPRF) has terminated all of State Street Global Advisors Ireland’s (SSgA) mandates in the wake of a £23m (€27.9m) fine imposed on State Street’s UK transition management business.
The penalty, imposed by the UK’s Financial Conduct Authority, was handed down after the regulator concluded the firm had “deliberately” overcharged six clients using its service – clients including the NPRF, which previously reclaimed €2.65m in non-contractual fees charged when it liquidated €4.7bn worth of its portfolio.
A spokesman for the NPRF confirmed that SSgA Ireland – at the end of 2012 in charge of €861m across three equity and one infrastructure mandates – had been let go.
In its statement, the spokesman only alluded to the termination of the indexed equity mandates, worth more than €600m, by the NPRF Commission.
It is unclear if the infrastructure mandate was still overseen by SSgA.
Separately, the fund also announced it had seen a 27% return in 2013, almost exclusively the result of a revaluation of the shares held in its directed portfolio, employed to support bailed out Bank of Ireland and Allied Irish Banks.
A €4.5bn increase in the bank portfolio was announced in January, with AIB ordinary shares valued at €0.0126 at the end of the year, up from €0.0079 in 2012.
According to a performance update published by the NPRF Commission, the directed portfolio returned 57.6% over the course of the last year, while the discretionary portfolio – still controlled by the Commission and soon to be redeployed to fund the Ireland Strategic Investment Fund – returned 1.8% in the three months to December, and 6.3% for the year.
At the end of December, the €6.8bn discretionary portfolio was 40% cash, 23% alternative investments, 25% equity and 10% euro-zone corporate and inflation-linked bonds.