UK - The £950m Bedfordshire County Council pension fund has tendered a new £100m global equities portfolio, and has also made a £50m allocation to commodities.
The global equities mandate will be funded from within the existing equities portfolio, broadly valued at £550m. The exact source location is yet to be decided.
The brief should be managed with a focus on achieving an absolute return, net of management fees, at a level of circa 4%-5% per annum, in excess of the UK Retail Prices Index (RPI) or equivalent over a five to 10 year horizon.
In February Global Pensions reported that the fund had appointed Barclays Global Investors (BGI) to a £50m global tactical asset allocation (GTAA) brief. This will complement the new brief.
“It’s been part of our idea to try and spread the investment risk,” commented Geoff Reader, head of pensions and treasury management.
At the time, Reader also said the fund was researching a passive allocation to commodities.
“We’ve just started that investment,” Reader commented today. “It’s 5% of the benchmark and we’re doing it through a pooled fund via Credit Suisse.”
Reader said the allocation was worth about £50m.
In other local authority news, the £800m Clwyd Pension Fund, administrated by Flintshire County Council, has awarded a £25m Asia Pacific (ex-Japan) equities portfolio to Aberdeen Asset Management.
In November last year, Global Pensions reported that the pension fund was re-tendering its Asia Pacific (ex-Japan) and global emerging markets equities portfolios, valued at around £25m each.
By Lisa Haines
The Pensions and Lifetime Savings Association (PLSA) has announced it will shrink its board by more than one-third as part of a governance overhaul to make it "agile and more appropriate".
Smaller FTSE 350 defined benefit (DB) schemes were nearly 15 percentage points less well-funded than larger schemes in 2017, according to a Goldman Sachs Asset Management (GSAM) analysis.
The advent of collective pension systems could help the UK avoid demographic challenges which will make it "impossible" for society to help savers in retirement, experts say.