NETHERLANDS - The €1bn Stichting Notarieel Pensioenfonds (SNPF) has awarded Aegon Asset Management a mandate to run part of its fixed income allocation and provide a fixed income overlay for an existing loans portfolio.
The mandate is split into two parts, with the first section comprising active management of a €100m fixed income portfolio including a range of investments in the eurozone, such as government bonds, corporate credit and high-yield bonds.
As part of the core plus investment strategy chosen by the scheme, Aegon will implement a tactical interest rate overlay that allows the strategy to match the risk/return requirements set by SNPF, by changing the duration of the portfolio. This is done through the use of long-term or short-term bonds.
In addition, SNPF has appointed Aegon Asset Management to provide this fixed income overlay on top of an existing portfolio of loans, valued at €140m. Aegon pointed out that loan portfolios can be illiquid and quite static with a fixed yield, so the pension fund felt it would benefit from the extra return of the interest rate overlay. It noted the overlay would act as a "derivative-type process" to help generate higher returns, and allow the scheme to take positions in a similar way to the bond portfolio.
Max Muntinga, director of SNPF, said; "We have chosen Aegon Asset Management because of its expertise in fixed income with which they have achieved excellent investment performance. The mandate that we awarded to Aegon matches perfectly with our requirements and adds the benefits of diversification to the existing investment strategies."
If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email firstname.lastname@example.org