UK - Consultancy firm bfinance has claimed the figure of 25% of local government pension schemes with some form of active currency allocation is set to "grow considerably".
The firm said that recent changes by the Department for the Communities, admitting active currency as an investment, would lead to increased appetite for specialist currency management on the part of local government funds.
bfinance recently advised the Berkshire and West Midlands pension funds on allocations to the asset class.
West Midlands has allocated 2% of its overall £7bn fund to three pure currency alpha managers: Record Currency Management, Mellon and BNP Paribas Asset Management.
Berkshire appointed Record Currency Management to manage a £410m active currency hedging – or currency overlay – mandate. The mandate comprised a passive component hedging 50% of the currency exposure and an active component using alpha funds aiming to generate 1.5% returns equivalent to £6m.
Partner Insight: Members' evolving needs and expectations are driving changes in scheme administration. As the pensions landscape inevitably continues to change, how will your scheme's approach need to develop to keep pace?
The Pensions Regulator (TPR) is "working closely" with government contractor Interserve and the trustees of its defined benefit (DB) pension schemes, it has confirmed.
The industry has welcomed the Department for Work and Pensions' (DWP) consultation on defined benefit (DB) consolidation as a way to address scheme covenant issues.
BMO Global Asset Management has opened a UK fiduciary management business, promising a "truly open architecture" approach to deliver "better client outcomes".