SWITZERLAND - The Swiss first-pillar fund AHV is looking for several active managers to manage CHF300m (€250m) in total as part of its portfolio restructuring exercise.
The CHF25bn AHV reserve fund for the Swiss social security system had been split into three entities at the beginning of the year and is now looking for a new asset management head, as well as several specialists.
In the most recent tenders, the fund is looking for four active managers.
One is for a CHF100m US Senior Loans mandate comprising "any senior loan from a US corporate issuer" benchmarked against the S&P/LSTA Leveraged Loan index, with a maximum 5% tracking error.
The AHV said it expected the manager to outperform the benchmark by an average of 75 basis points (net of all fees) per year over a four-year period.
The second search is for a CHF50m European Senior Loans mandate benchmarked against the Credit Suisse Western European Leveraged Loan index with the same conditions as for the US Senior Loans tender.
Further, the AHV is looking for a manager for a CHF100m US Sub-Investment Grade portfolio benchmarked against the Merrill Lynch BB-B US Non Financial Constrained with a maximum 10% tracking error.
Overall, the fund expects the manager to outperform the index by 100bps over a cycle of four years.
As for the investment universe, the fund specified that it can contain "any non investment-grade bond from a US corporate issuer", but added that convertible bonds and emerging market bonds would not be part of the universe.
Additionally, exposure to financials and bonds rated lower than B- is to be limited to 15% each.
A similar mandate half the size is tendered for EU Sub-Investment Grade bonds benchmarked against the Merrill Lynch BB-B European Currency Non-Financial Constrained, matching the same specifications as the US mandate.