BRUSSELS - The 12 billion Belgian franc ($414 million) Belgian pension fund of A.S.B.L. Fonds de Pension de l'International Business Machines of Belgium, Brussels, hired three managers to run a total of $150 million in global equities. The IBM fund has about 60% of its assets invested in stocks, down slightly from 65% earlier this year.
Picked to run active portfolios of $30 million each were G.T. Capital Management and Morgan Stanley Asset Management. BZW Investment Management was selected to manage $90 million in a passive portfolio.
The hirings complete a restructuring of the fund's internal and external manager mandates, said Yves Debongnie, IBM's pension fund manager who plans to leave the company around the end of September. Mr. Debongnie is exploring positions in money management and consulting.
With the latest moves, the IBM unit has totally outsourced the management of its pension assets - $60 million came from an internally managed international equities portfolio while the rest came from terminated managers. Mr. Debongnie declined to name those managers.
ROME - Italian Premier Lamberto Dini scored a major victory earlier this month when lawmakers approved a long-debated plan for reforming Italy's bloated and abuse-ridden pension system. He had made trimming the pension system a priority after talking office in January.
The plan is designed to save about $63 billion over the next decade. It could also could accelerate the recovery of the lira, which crashed to record lows this year.
The new law sets 52 as the minimum retirement age and raises it to 57 by 2012. Previously Italy had no minimum. The measure also changes the way pensions are calculated to take into consideration the number of years worked.
ABERDEEN, Scotland - The (pounds) 580 million ($928 million) Grampian Regional Council Superannuation Fund hired Mercury Asset Management to manage a (pounds) 120 million U.K. equities portfolio, said Robert Dingwall, Grampian's finance director. The portfolio previously had been managed by M&G Investment Management, which was terminated.
The fund also hired Morgan Grenfell Investment Management to run (pounds) 180 in a tactical asset allocation portfolio and Schroder Investment Management for a (pounds) 12 million Far East (including Japan) equities portfolio.
The TAA portfolio previously was managed by PanAgora Asset Management, while the Pacific Basis portfolio - which has been reduced from (pounds) 14 million - had been managed by GT Management.
Humans Robertson consulted on the U.K. and Far Eastern searches; Sedgwick Noble Lowndes assisted with the TAA search.
International money managers returned 3.8% in the second quarter - 300 basis points above the 0.8% return from the benchmark Morgan Stanley Capital International Europe Australasia Far East index, according to The WM Co., Edinburgh.
The outperformance is almost entirely due to managers' underweighting in Japan, according to Callum Robertson, a WM analyst. The market's 7.9% decline in yen terms helped international managers who were light in Japanese stocks to outperform the benchmark.
The WM Non-U.S. Universe is nearly 15% underweighted in Japan. Heavier exposure to Pacific Basin and emerging markets also boosted performance. Also, stock selection - particularly in Japan and the Netherlands -improved average returns by one percentage point.
For the rolling 12-month period, international managers achieved a 2.5% return compared with 1.9% for the index.
Underweighting in Japan again accounted for much of the outperformance.
LIVERPOOL, England - Tilney Unit Trust Management, Liverpool, has launched a pooled fund geared toward pension funds and other tax-exempt entities.
The fund's objective is to beat the Combined Acrtuarial Performance Services median through investment in global bonds and equities.
The fund is managed by Peter Botham, who recently joined Tilney from Henry Cooke Lumsden.
HONG KONG - The stock market of Indonesia should be the best performer in the Southeast Asian region during the next 12 months, followed by that of Thailand, predicted Manu Bhaskaran, director, Crosby Securities in Hong Kong.
Mr. Bhaskaran forecasted that Indonesia's market, aided by "economic acceleration" and lower interest rates, would gain "well in excess of 25%" over the next year. Thailand, he said, should advance 22% to 25%.
Crosby Securities least favors the Malaysia's market and that of the Philippines.
In Malaysia, Mr. Bhaskaran said he expects monetary policy to be tightened, while in the Philippines, he anticipates the "overvalued" peso will experience a correction.
Frank Russell Co. and Mitsubishi Trust Bank have developed an asset/liability model that will be used initially by Japanese pension funds for which Mitsubishi is the master trustee.
Russell is seeking an organization that can adapt this model for use in the United States and in Europe and market it in those areas.
The Frank Russell-Mitsubishi Trust Pension Asset Liability Management model makes recommendations on how plan sponsors should invest now and in the future to fulfill their obligations, explained Christine Noonan, marketing and sales director for Frank Russell.
The Russell-Mitsubishi product makes decisions based on the actual investment needs and practices of a fund vs. merely inserting a set of what-if scenarios.
The new company will be headed by Henk Klein Haneveld, a former Shell Pension Fund official who set up his own consulting firm five years ago.
The Dutch operation will be staffed by Klein Haneveld's six consultants. Seven other London-based Mercer staff also will concentrate on the Netherlands.
Mercer is looking at additional expansion in continental Europe, a spokeswoman said.
Buck Consultants opened an office in Trinidad and Tobago to service the Caribbean and Central and South America. The office, located in the capital of Port of Spain, will be headed by Kyle Rudden.
MUNICH - HYPO Capital Management Investmentgesellschaft has agreed to distribute EquiFund, a Luxembourg-based SICAV umbrella fund managed by Wright Investors' Services, Bridgeport, Conn., to its clients in Germany. EquiFund manages $28 million in 12 country-specific and regional equity sub-funds. Its distribution agreements already include banks in Brazil, France, Greece, Hong Kong, Italy, Japan and the Netherlands.
Foreign & Colonial Emerging Markets is launching the Polish Investment Co., the first open-end fund to invest exclusively in Polish listed equities.
Foreign & Colonial "expects the fund to be used predominantly as an asset allocation tool to enable institutional clients to gain balanced exposure" to what it calls "the fastest-growing economy in Europe," according to a statement.
The Polish stock market lists 48 companies with a total market capitalization of $4 billion, and is expected to expand at a rate of two new listings per month through this year.
The fund will be valued daily in U.S. dollars. It will have a 1.75% annual management fee, including a 1% redemption fee the first year and 50 basis points thereafter.
The Certified Financial Planner Board of Standards and the Institute of Financial Planning, a multidisciplinary professional body for U.K. financial planners, have reached an agreement allowing the use of the CFP and certified financial planner designations in the United Kingdom. Effective immediately, the IFP will be able to grant use of the designations to U.K. planners who meet standards of education, examination, experience and ethics for financial planning.
Tim Barker has joined London-based Quilter Goodison as business development director, a new position. Quilter Goodison is an investment management arm of Commercial Union. Previously, Mr. Barker had been director of international private clients at Capital House, which last year was absorbed by Newton Investment Management.