NEST seeks asset manager for move into high-yield debt

first_imgThe UK’s National Employment Savings Trust (NEST) is to diversify its exposure to high-yield debt and is seeking an asset manager to oversee an actively managed mandate.The £1bn (€1.1bn) master trust’s CIO, Mark Fawcett, said global high-yield bonds offered “attractive” returns in a fixed income environment otherwise dominated by low-yielding paper.“Procuring a high-yield bond fund will also further diversify our members’ portfolios,” Fawcett added.“By including this asset class in our building block mandates, we will be joining the growing number of institutional investors holding high yield.” In a statement accompanying the tender, NEST added that it was looking for a manager with a robust risk management framework, able to consider environmental, social and governance factors.The tender also stated that NEST would invest using a pooled fund, rather than opting for a segregated mandate. Expressions of interest are requested by 12 December.NEST members are already exposed to high-yield debt, although the limited exposure to date forms part of the passively managed multi-asset mandate overseen by BlackRock.The pension provider last year pledged to expand the number of standalone, single-asset mandates in an effort to gain greater control over its asset allocation as its AUM has grown.Since then, it has named Amundi as its emerging market (EM) debt manager, sitting alongside standalone EM equity mandates and funds investing in global property.The eventual high-yield manager would join an increasing number of active managers employed by NEST, including Amundi and Legal & General Investment Management and BlackRock.NEST has to date largely opted for passive mandates in an effort to control costs, in line with its 0.3% annual management charge.last_img read more

Euro-zone ministers to discuss benchmarking pension systems

first_imgEuro-zone finance ministers aim to agree a plan to benchmark member state pension systems when they meet next week.The Eurogroup, an informal body bringing together ministers of the euro area, will next meet on 20 March, and is due to discuss the sustainability of member states’ pension systems.“Ministers will look into the possibility of introducing benchmarking in this policy area, and will discuss the choice of indicators and the frequency of reporting,” according to a statement from the group.The goal is to agree “the modalities of a benchmarking exercise”, it added. The debate about benchmarking will be based on a recent analysis carried out by the European Commission, according to the statement.It would be the ministers’ third round of discussions on pension sustainability in the euro area. The first was in December 2015, when the group identified “putting pension systems on a sustainable path” as a policy priority, given an ageing population and other developments.In June last year the group adopted a set of common principles for strengthening the fiscal sustainability of pension systems and invited the Commission to come up with appropriate benchmarks, based on the common principles.The Eurogroup usually meets once a month, on the eve of a meeting of EU economics and finance ministers.Other topics due to be on the agenda of next week’s meeting include a review of macroeconomic reforms in Greece and euro area countries’ annual debt issuance plans.last_img read more

Dutch chemicals firm records 66.6% gain from ground lease investment

first_imgPDN, the €6.9bn pension fund of Dutch chemicals firm DSM, generated a net result of 7.5% last year, in part thanks to a 66.6% gain on an investment in long-term ground leases.Bob Puijn, PDN’s chief investment officer, described the investment as a “private inflation-linked loan” and said the pension fund had benefited from investing at the right moment.“At the time of the investment, in 2013, we could demand a risk premium of 300 basis points combined with a limited risk. Soon after this, the expected inflation decreased,” he said.According to the CIO, a similar investment now would come with a risk premium of no more than 150 basis points. Gerard Rutten, PDN’s chief executive, added that the result was in part attributable to a revaluation of the investment last year, “as the initial valuation criteria had turned out not to be in conformity with the markets”.PDN’s ground lease holdings – 2.1% of its matching portfolio – are a direct investment in future cash flows from heriditary residential ground leases in Amsterdam, Rotterdam and Maastricht.Since its investment, the asset class generated 37.6% a year on average, according to PDN. It said the combination of a long duration and its inflation link made it a good investment for matching its liabilities.PDN said it wanted to double its 5% allocation to residential mortgages this year, at the expense of the liquid components of its matching portfolio. Its mortgage holdings yielded 5.9% last year.The pension fund reduced its interest hedge from 65% to 35% last year, enabling it to significantly reduce its holdings of “nominal payer” swaps. Following a decline in interest rates, the deployment of the passive swaps hit its overall return by 0.9 percentage points.PDN also said that it hadn’t adjusted its strategic investment policy, “as a reduced risk profile would have hampered achieving our indexation target and would have increased the chance of rights cuts”.On the other hand, the scheme would not be allowed to raise its risk profile as funding level of 102.8% at year-end was too low, it said. However, its coverage ratio improved to 107.6% as of May.The pension fund said it had reduced its board by one-third to eight members, in order to increase its effectiveness. Within this new set up, PDN said it could appoint two external experts.PDN has 28,395 participants, 6,515 of whom are active and 13,655 are pensioners. Last year, it spent 0.29% on asset management and 0.07% on transactions. Administration costs per participant totalled €238.last_img read more

Dutch regulator considers outsourcing regulatory tasks

first_imgThe Dutch regulator could outsource supervision of “low-risk” pension funds to private sector providers, it has said.The pensions supervisor De Nederlandsche Bank (DNB) said pension funds with a low risk profile and sound internal supervision could have some regulatory tasks handed over to external providers.In a report about “proportional and effective supervision”, published last week, DNB said the conclusions were the result of a survey – based on feedback from the sector – into whether supervision had been excessive since the financial crisis.According to Frank Elderson, supervisory director for pension funds at the regulator, DNB could, for efficiency reasons, request certain information from providers rather than from pension funds. However, as providers are currently not supervised by DNB, involving them would require legal changes.Elderson said that DNB would also consider sourcing information from asset managers.The report also suggested increased remote supervision of low-risk pension funds, with DNB relying on information and statements from external parties, including actuaries and accountants.Elderson added that a scheme’s funding could also be used as a criterion for relaxing supervision.Jan Sijbrand, DNB’s chairman for supervision, pointed out that the report was the result of a “listen project”, and that the watchdog had compiled a list with more than 100 issues based on signals and complaints from the sector.The report said the regulator’s ad hoc requests – such as for sector and themed surveys – posed the largest supervisory burden for pension funds, as they sometimes came unexpectedly and had short deadlines.DNB rejected warnings from the sector that boards had become distracted by regulations and could not pay sufficient attention to risk management and strategy as a consequence.The survey, however, found that the boards of small pension funds often had to spend more than 30% of their available time on regulations, with indirect costs making up 75% of total supervision costs, compared to 40% at large schemes.The watchdog also promised to proportionally apply the IORP II directive’s requirements for key positions to small and medium-sized pension funds, which were worried that they no longer could outsource, for example, actuarial services.DNB said that it was open to a dialogue with pension funds about their proposals for adhering to the rules set by IORP II.last_img read more

People moves: UBS hires Unilever’s in-house sustainability expert

first_imgPension Insurance Corporation – Simon Abel has joined the specialist insurer as head of corporate development and strategy. He takes over from David Collinson, who has led PIC’s strategy team since 2014 and will continue to work with the company in a senior advisory capacity.Abel was most recently a board director of Aon Securities Limited, the investment bank within Aon, and has worked for financial services-focused investment banks such as Fox-Pitt, Kelton, and Keefe Bruyette & Woods. Amundi – France’s biggest asset manager has appointed Philip Philippides to lead its third-party distribution efforts in the UK. He joined Amundi in January 2014 as head of ETF and indexing sales for UK and Ireland. He has also worked for Old Mutual, Morgan Stanley and iShares.SEI – Louise Whyte has been appointed regional director of defined contribution (DC) in the fiduciary manager’s institutional group. Whyte will be responsible for business development in the EMEA region.She most recently served as a relationship manager at BlackRock where she was responsible for more than 100 DC pension plans. Before joining BlackRock, Whyte worked in a variety of client-facing roles at JM Finn & Co, Jupiter Asset Management, and M&G. Fiera Capital Corporation – Kanesh Lakhani has been appointed European CEO of the independent asset manager Fiera, succeeding Jayne Sutcliffe. Prior to joining Fiera Capital, Lakhani was managing director for EMEA and Asia distribution at First State Investments for more than seven years, and before that he worked for State Street Global Advisors.  Akio OtskuaFulcrum Asset Management – The £4.7bn (€5.3bn) UK-based investment manager has named the former head of Sumitomo Mitsui Trust Asset Management as a senior adviser as it seeks to expand its international footprint. Akio Otsuka is currently an executive adviser to Sumitomo Mitsui Trust Bank, where he has worked in a variety of senior roles since joining in 1976.During his career in Japan Otsuka has led a drive to increase investment in alternatives and multi-strategy products, while in charge of Sumitomo Mitsui’s fund management group.Andrew Stevens, Fulcrum’s chief executive, said Otsuka’s reputation and experience was “second to none and his comprehensive understanding of the asset management business in Japan will be invaluable as we fully commit to serving clients in the country”.Kempen Capital Management – The Dutch investment house has made two hires to fill newly created roles within its UK team. Alastair Greenlees has been appointed as senior investment strategist and Craig Stevenson as consultant relations director.Stevenson has more than 20 years of experience within the pension and investment industry from both an investment consulting and asset management perspective and was head of institutional and consultant relations at Old Mutual Global Investors before joining Kempen this month. Before that he was a senior investment consultant in the hedge fund manager research team at Willis Towers Watson. Greenlees joined Kempen from Willis Towers Watson where he was a senior investment consultant.Johan Cras, managing director at Kempen, said the company created the two new roles “to handle the demand for our client solutions and our plans to grow in the UK market”.Eaton Vance Management – The US asset manager has recruited Dónal Kinsella as an institutional portfolio manager for its corporate credit strategies, a newly created position. Eaton Vance is specifically targeting corporate credit investors in Europe, Asia and Australia, and Kinsella will be tasked with overseeing market research and analysis, and providing investment communications and market insights.Kinsella was previously a client portfolio manager at Janus Henderson Investors, where he was also a trustee of the company’s defined benefit and defined contribution pension schemes. Prior to joining Janus Henderson he worked as an investment consultant at Mercer and Lane Clark & Peacock. UBS Asset Management, Univest, Pension Insurance Corporation, Amundi, SEI, Fiera Capital, Fulcrum Asset Management, Kempen Capital Management, Eaton Vance ManagementUBS Asset Management – The Swiss investment house has hired Karianne Bail-Lancee as a sustainable research analyst, based in London. She started her new position on Monday.Bail-Lancee has worked for six years as investment and sustainability manager at Univest, the in-house investment manager for Unilever. While there, she set up a dedicated sustainable investment fund for use by Unilever’s various pension funds around the world. She is also a member of the listed equity advisory committee for the UN’s Principles for Responsible Investment. last_img read more

Former ECON chair Sharon Bowles on the EU’s financial crisis response

first_img“I think there are various technical faults that slowly get corrected or could have been done better,” she told IPE. “I think it was acknowledged that it had all got over-restrictive, which was why Lord Hill did a stocktaking and there was talk of simplification. The former chair of the European Parliament’s Economic Affairs Committee (ECON) has delivered a blunt assessment of the successes and failures of her tenure as one of the EU’s top lawmakers on regulatory affairs.In a Chatham House speech, delivered last month to mark the 10th anniversary of the collapse of the Lehman Brothers investment bank, Sharon Bowles voiced her regret over shortcomings in the EU’s political and legislative responses to the crisis and warned of mounting risks posed by the failure to tackle problems in the accounting and audit professions.She referred to “international impatience with the slow pace of some EU actions, particularly bank recapitalisation, about which there was both denial and not wishing to stump up the cash”. Bowles later expanded on her assessment of the shortcomings in the EU’s regulatory and political responses to the crisis. Sharon Bowles“Probably the worst legislation was short selling restrictions, but it ended up a lot less worse than banning short selling, which was how it all started. Actually, all it does is in fact to say that you have to know where you can get the stock from before short selling it.”She reserved her strongest words for the accountancy and audit professions, of which she has been a vocal critic for some time.Addressing her Chatham House audience, she said: “One question that has never been properly addressed – and it has come up again recently in the UK with non-financial companies – is that company reports and audits paint a rosy picture just months before a company collapses.“In my view, the issue of neutrality in IFRS conflicts with the prudence required in company law. Company law is the one that is right. Keep on ignoring it and there’s the next crisis.”SecuritisationBowles also highlighted the negative effects of securitisation rules contained in the EU’s Capital Requirements Directive (CRD).She said: “The introduction of a ‘skin in the game’ retention of a part of every securitisation, instead of selling off all of it, was introduced into CRD2, and in the absence of such a retention there was a prohibitive capital charge.“The idea was that, if it was dodgy, the bank shared in it. It put an end to a lot of the ‘originate to distribute’ model, but it also killed off better securitisation.”Bowles later told IPE that the episode had made the EU’s recent review of the rules – part of its Simple Transparent Securitisation workstream – all the more fraught.See also: IPE’s Special Report – 10 years since Lehmanlast_img read more

Switzerland roundup: Government rejects expert view on interest rate

first_imgHans-Peter Wiedmer, Bernische PensionskasseSeparately, Hans-Peter Wiedmer has been appointed CEO of the CHF13.5bn (€11.8bn) Bernische Pensionskasse. He was previously deputy managing director.Wiedmer has been with the pension fund for the city of Berne for almost 40 years and has led the asset management department since 1994.IPE revealed in June that Werner Hertzog was leaving the fund after almost two years as managing director.According to his LinkedIn profile Hertzog is now “independent, freelance”, after leaving the Pensionkasse in October, but no details of his new job were revealed.He told IPE in June that he “was going to pursue other tasks”.Last year the Bernische Pensionskasse managed a return of 8.2%, beating the market average. As at the end of September 2018 the fund yielded a net return of 1% while the market average stood at around 0.3%, according to samples compiled by Credit Suisse. The Swiss government has left the minimum interest rate for accrual in Pensionskassen unchanged at 1%, despite the recommendation of an expert group to cut it to 0.75%.It was the first time the Swiss government had not followed the BVG commission’s advice on adjusting the minimum interest rate (Mindestzins).The BVG expert commission this year changed the formula for calculating the interest rate Pensionskassen have to guarantee on active members’ accrued assets. It removed the seven-year average yield on Swiss government bonds to allow for further declines in interest rates.Based on these calculations, the BVG commission had issued a recommendation to cut the minimum interest rate from 1% to 0.75%. Pension fund association Asip also supported this move. In addition, other commentators and employer representatives advocated a reduction in the rate as the recommendation would have been 0.5% using the old formula.The Swiss Employers’ Confederation said the government’s decision to ignore the recommendation was “proof that decisions on the rates in the second pillar are purely political ones”.Asip argued that, even with the BVG’s recommended cut, the mandatory second pillar would still have contributed more than one third to people’s pensions.Currently this part of the pension system makes up 41% of individuals’ retirement income on average.Asip also called for the “depolitisation” of decisions regarding key rates in the second pillar.New head for Bernische Pensionskasselast_img read more

Luxury car dealer Martin Roller has rung up a deal on his Hamilton home

first_imgCar dealer Martin Roller has sold his luxury Hamilton home. Picture: Peter WallisBRISBANE luxury car dealer Martin Roller, has done a deal on his luxury home at 30 Windermere Rd, Hamilton, worth $6 million.More from newsNew apartments released at idyllic retirement community Samford Grove Presented by Parks and wildlife the new lust-haves post coronavirus18 hours agoHe recently purchased another home at Clayfield for $4,150,000.Property records revealed he paid $4,685,000 for the Windermere Rd, home in August 2012.Marketing agent Dwight Ferguson of Ray White Ascot confirmed a contract had been signed for the Windermere house and it was now unconditional.At the time of buying it Mr Roller said he was very impressed with the size of the house and the style, which he described as “sophisticated’’.It has a large 3000 bottle wine cellar, in which Mr Roller and his partner hosted numerous dinner parties. There are six bedrooms, a championship-size tennis court and a swimming pool.last_img read more

Post-war cottage at Mount Gravatt East hits market after renovation overhaul

first_imgREAL ESTATE: 72 Invermore StTHE home at 72 Invermore St gave Brooke Garner a taste for renovation – and now she has a thirst for more.When Ms Garner moved into the home in 2016, she had a big job ahead of her.“It was a complete renovator, which is what I was looking for,” Ms Garner said.“I was attracted to the position of the home and the fact that it had good bones.” One of the renovated bathrooms has a moody vibe.Out on the back deck is Ms Garner’s favourite place at the property.“I really love the deck area, with the breezes that come through.” The kitchen has stainless steel benches.Ms Garner set to work, completing renovations in every room of the property.“We knocked walls out, we VJ panelled the entire house, and we painted inside and out,” she said.The home has three bedrooms and two bathrooms, which Ms Garner said was a drawcard for the home.“Two bathrooms is quite rare for that street,” she said.“I renovated both of those.” The floorplan of 72 Invermore St, Mount Gravatt East.Video Player is loading.Play VideoPlayNext playlist itemMuteCurrent Time 0:00/Duration 10:02Loaded: 0%Stream Type LIVESeek to live, currently playing liveLIVERemaining Time -10:02 Playback Rate1xChaptersChaptersDescriptionsdescriptions off, selectedCaptionscaptions settings, opens captions settings dialogcaptions off, selectedQuality Levels720p720pHD432p432p270p270p180p180pAutoA, selectedAudio Tracken (Main), selectedFullscreenThis is a modal window.Beginning of dialog window. Escape will cancel and close the window.TextColorWhiteBlackRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentBackgroundColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentTransparentWindowColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyTransparentSemi-TransparentOpaqueFont Size50%75%100%125%150%175%200%300%400%Text Edge StyleNoneRaisedDepressedUniformDropshadowFont FamilyProportional Sans-SerifMonospace Sans-SerifProportional SerifMonospace SerifCasualScriptSmall CapsReset restore all settings to the default valuesDoneClose Modal DialogEnd of dialog window.This is a modal window. This modal can be closed by pressing the Escape key or activating the close button.Close Modal DialogThis is a modal window. This modal can be closed by pressing the Escape key or activating the close button.PlayMuteCurrent Time 0:00/Duration 0:00Loaded: 0%Stream Type LIVESeek to live, currently playing liveLIVERemaining Time -0:00 Playback Rate1xFullscreenJune, 2018: Liz Tilley talks prestige property10:02center_img More from newsCrowd expected as mega estate goes under the hammer7 Aug 2020Hard work, resourcefulness and $17k bring old Ipswich home back to life20 Apr 2020There are VJ walls and polished timber floors throughout.Ms Garner said she was pleased with how the renovation turned out.“It’s the perfect little cottage.“It’s so homely and very welcoming.” The other bathroom is light and bright.She styled the home on her own, gaining inspiration from reality TV shows and Pinterest, and buying a lot of furniture from Gumtree.“I think someone will definitely fall in love with it (and) it would suit a young professional couple with one or two kids, or people who are downsizing.”While Ms Garner shot down any talk of competing on The Block anytime soon, she will be taking the renovation plunge again.“I’m going to be doing another renovator,” she said.“There were some stressful times, but I’d do it all again in a heartbeat.”last_img read more

Vacancy rates fall as renters return

first_imgHouse key on a house shaped keychain resting on wooden floorboards concept for real estate, moving home or renting propertyTHE city’s residential vacancy rate is sitting at 3.6 per cent as oversupply continues to get absorbed, a newly released report has revealed.The August Residential Vacancy Update undertaken by DS Economics and commissioned by Townsville Rentals shows the rental market is continuing to strengthen across the city.Vacancy rates have continued to tighten since they were sitting at 5.9 per cent in July, while they were at 5.3 per cent at the beginning of July, according to DS Economics.Townsville Rentals business development manager Tamara Beacroft said their agency vacancy rate had steadily improved and was currently at 2.1 per cent.“Townsville residents appear to be renting houses more so than units at the present time, so the suburbs that contain mostly house properties appear to be performing very well,” she said.“The report shows that the market still has a little way to go before we see increased returns on property investment, but we’re successfully finding tenants for good quality properties that are offered at a reasonable price.”More from news01:21Buyer demand explodes in Townsville’s 2019 flood-affected suburbs12 Sep 202001:21‘Giant surge’ in new home sales lifts Townsville property market10 Sep 2020The report, which also breaks down vacancy rates by postcode, shows vacancy rates are as low as 2.4 per cent in suburbs with the postcode 4817, such as Kirwan.Deeragun and Northern Beaches suburbs also have vacancy rates below the Townsville-wide average with 4818 suburbs recording a vacancy rate of 2.7 per cent.Areas with plenty of housing stock are doing better, with renters preferring houses rather than units.DS Economics economist Colin Dwyer said in the past month there had been similar residential absorption activity to the same time last year.“Over 125 homes have been absorbed in the past four weeks,” he said.“That’s helped to almost halve the number of vacant properties in 12 months.“Job creation, major construction projects and grey nomads have a lot to with the much better residential vacancy rate performance.“There are more major projects in the pipeline.”last_img read more