GERMANY – State Street Global Advisors’ German arm says that since the beginning of the year, it has taken in €2bn in new assets – or the same amount for all of 2005.
SSGA in Germany said the inflows include a €300m passive bond mandate awarded last month by pension fund Aventis Pensionstreuhand. The €2.1bn scheme insures German employees at pharmaceuticals giant Sanofi-Aventis.
Of the inflows in 2005, SSGA in Germany said €1.2bn went to its institutional funds, while the remaining €800m went to its mutual funds.
Not counting the €2bn from this year, the asset manager has €13.8bn in assets under management, 60% of which is from pension funds.
Commenting on the inflows, Klaus Esswein, chief executive of SSGA in Germany, said they were proof that “we made the correct strategic decision in abandoning our investment company (German KAG) in order to concentrate fully on portfolio management and advisory.” The decision was made in September 2004.
SSGA in Germany said it was now a specialist in passive mandates, with equity ones accounting for half of the €13.8bn in AUM and fixed incomes ones making up one-quarter.
Indeed, Esswein told a press conference in Frankfurt yesterday that as interest rates had declined over the past two years, institutional investors had been favouring passive fixed income mandates over active ones.
To illustrate this point, Esswein cited last month’s mandate from Aventis Pensionstreuhand.
SSGA in Germany is already one of the incumbent asset managers for the pension fund. Last October, the fund awarded it with a mandate to shield €800m worth of assets from currency-related risks and to generate additional returns with them.