SWITZERLAND - Goldman Sachs Asset Management (GSAM) is planning to roll out its Fiduciary Management Services to Swiss pension funds later this year. Fiduciary Management Services includes asset liability modeling, manager selection and monitoring, and risk budgeting.
The asset manager is planning to kick off its Swiss launch with a series of conferences for Swiss pension funds to be held in the next couple of months.Ruud Hendriks (pictured), head of institutional business development Continental Europe, Middle East and Africa, said: “We are seeing an interest from Switzerland and we have started talking to pension funds there. We certainly see opportunities in the market.
“If you look at the structure of Swiss pension funds, it is mostly balanced mandates that are split into equities and bonds. There is limited active asset allocation between the asset classes and individual equity and bond markets. So I believe if you state your case clearly, explain that this is possibly not the best way forward, and that better use could potentially be made of their risk budgets pension funds will listen.”
GSAM’s fiduciary management business has garnered around US$29.7bn in assets under management, for both institutions and high net worth individuals. Following the introduction of the service four years ago in the Dutch market, GSAM has three clients managing assets worth €2.3bn. GSAM’s most recent addition was the €350m pension fund Campina.
Hendriks added: “Given the nature of the business, we are happy if we can add one or two clients a year. This is quite a labour intensive business.
“We try to help larger pension funds whose core business is not managing pension assets. We help with risk budgeting and try to address some fundamental issues, how can one get more return per unit of risk? What is the best asset allocation? What is the best benchmark?
“We also don’t pick GSAM when hiring managers. That would be a direct conflict of interest.”
Hendriks added that the fund manager was also looking to “expand” its business in the Dutch market, and will be looking for the right opportunity.
GSAM is understood to have been the strongest contender with Merrill Lynch Investment Managers (MLIM) for Philips’ €13.5bn assets. Hendriks declined to comment on the Philips deal.
MLIM is understood to have paid in the range of €40-50m for the deal.
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