UK - Barclays Global Investors (BGI) has lost a £2bn global equity mandate from Barclays Bank UK Retirement Fund (BBUKRF) because it could not provide the fund with the appropriate service in selecting managers.
A spokesman for the pesnion fund told Global Pensions that the overall Barclays UK retirement fund had outperformed its benchmark for each of the last four years. He also confirmed that BGI’s transition management service had facilitated the mandate transfer.
It means the £16.8bn BBUKRF fund, which is sponsored by Barclays plc, has appointed Russell Investments to design and manage a £2bn portfolio of third-party high alpha global equity managers.
The mandate combines a diversified range of 15 equity managers, using both global and regional mandates and will be run by Neil Jenkins, a specialist in segregated multi-asset portfolio management and managing director in Russell’s Investment Management and Research group.
A spokesperson for the pension fund told Global Pensions the reason it decided to drop BGI was because: "BGI does not offer the services that Russell does in selecting and managing a range of equity fund managers."
Johan Cras, managing director for institutional investment services at Russell, said: “Russell has been able to offer Barclays pension fund the opportunity to build a tailored multi-manager portfolio. Furthermore, in this appointment Russell has clear accountability for manager performance, something which is missing in many traditional consulting relationships.”
In addition to selecting managers, Russell will also be responsible for ongoing additional portfolio implementation matters such as cash equitisation, foreign exchange execution and transition management.
Ian Barnes, director for business solutions at Russell, concluded: “Manager selection and deselection can be one of the most inefficient aspects of trustee decision making, largely due to a lack of accountability and an inefficient framework for the execution of any resulting changes.”
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