UK - The £620m Corus Engineering Steels Pension Scheme is looking to increase its exposure to fixed income, Keith Young, group pensions manager, said.
The scheme is currently undergoing a valuation and once it is finished in April the scheme will look to make its move. The Corus fund is mature, Young said, explaining that it needs to increase its allocation to fixed income to ensure its assets match liabilities.
He also said that if the move is approved, the money would most likely come from its equities portfolios. Deutsche Asset Management and Schroder Investment Management currently manage the fund, a position they have held together since 1995. Young declined to comment on whether or not the pair will be retained after the bond shift or if new mandates would be put out to tender.
Young was quick to add that the scheme would not follow Boots’ lead and move entirely into fixed income, adding that the scheme will always retain an equity aspect. Boots shifted its £2.3bn pension scheme entirely into fixed income last October.
According to Pension Funds and their Advisors, the scheme currently allocates 45% of its assets to UK equities; overseas equities, 19%; UK fixed income, 6%; overseas bonds, 1%; index linked gilts; 21%; UK real estate, 3%; cash and deposits, 2%; and unit trusts, 3%.
William M Mercer is the scheme’s actuary and consultant.
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