SWITZERLAND- SwissAir has announced the names of managers appointed to run e600m in five sub-funds belonging to the recently restructured pension scheme. The fund has appointed managers to five mandates, each valued at approximately e120m.

Wellington has been appointed to run both an active US equities and an active European equities sub fund. Capital International has been appointed to oversee the active pacific equities mandate.

Each of the equity mandates are to be run on aggressive basis, according to Felix Kottmann, the investment consultant to the fund, who says that tracking errors are likely to be between 7% and 12%.

For a US Bonds, index-enhanced sub-fund, the scheme has appointed Bank of New York while Dresdner Investment Management in Frankfurt is to run an equivalent European bond mandate. These two, although index-enhanced, will operate at no more than 20 basis points from the benchmark.

Kottmann says they considered appointing a manager for a similar enhanced Swiss bond mandate but that the applicants were insufficiently impressive. “We already have an index-tracking product for Swiss bonds and the difference between the active and indexed product was not sufficient to justify making an appointment,” he says.

In February, SwissAir Pension Fund Services, the company created to service and administer the scheme, announced it was looking for the managers by using the electronic manager selection system www.IPE-QUEST.com.

The appointments are the culmination of a complete restructuring that began last year. At the beginning of 2001, SwissAir’s Chf13bn (e8.8bn) scheme was divided into four separate funds- one for the pilots, one for ground staff and two for other employees.

They decided to pool their investments in an umbrella fund to gain economies of scale and even after SwissAir, the sponsor and mother company, went bankrupt in October, the project continued as planned to a January 1st deadline for the launch of an umbrella fund.

By January 3rd, the fund had launched two, one covering traditional assets and managed by UBS Fond, the other covering alternative assets and run by Unigestion.

Under the UBS umbrella there are six sub funds, all managed externally, including five index trackers and one active Swiss equity mandate. The five new appointments are to similar, but new, sub funds.