LONDON -- First Quadrant has raised $140 million for four market-neutral pooled funds covering the United States, the United Kingdom, Japan and a combination of the three markets.
About $50 million came from U.K. pension funds, with some money also coming from an unidentified U.S. pension fund and off-shore investors.
The publicly traded pooled fund, known as the Antiope Alpha Fund, is an unregulated collective investment scheme. It is based in Dublin, Ireland, to avoid legal problems U.K. pension funds face when investing in short positions.
Lloyds tells custody clients to move assets to State Street
LONDON -- Lloyds TSB Group has decided to exit the custody and unit trust trustee business, recommending its 430 clients transfer their business to State Street Bank.
Officials at Lloyds TSB, with L140 billion ($221 billion) in assets under custody, noted the bank was a relatively small player and could not afford the infrastructure investments required to stay competitive.
Lloyds, one of the largest custodians for U.K. pension funds and one of the largest trustees to the U.K. unit trust industry, is dwarfed by State Street's $5.3 trillion in assets under custody. Terms of the arrangement were not disclosed.
Ken Farquhar, managing director of Lloyds TSB's securities business, said the bank hopes to avoid layoffs of the 1,100-person staff through turnover, early retirement and internal transfers.
Fund buys big stake in Brazil's Traffic
DALLAS -- Hicks, Muse, Tate & Furst acquired a 49%ownership interest in Traffic, a Brazilian company that controls the broadcast, cable and pay-per-view rights to many high-profile Latin American soccer events, including those of the Brazilian National Team. Terms of the deal were not revealed.
Investors in Hicks' $964 million Latin American fund include the $23 billion Public Employees' Retirement Association of Colorado, Denver; $91 billion General Motors Investment Management Co., New York; $1.6 billion Houston Firefighters' Relief & Retirement Fund; $39.6 billion Ontario Teachers' Pension Plan Board, Toronto; and the $2.2 billion endowment of the University of Chicago; and $1.3 billion endowment of Vanderbilt University, Nashville, Tenn.
Private plans in Europe give more assets to managers
LONDON -- Outsourcing by European pension funds and insurance companies is on the rise, according to a new study by InterSec Research. The survey of more than 300 senior investment officers in charge of more than E1.5 trillion ($1.56 trillion) found that 25%of all assets are managed by external money managers, up from 18%four years ago.
Key findings include: private pension funds hand out about half of their assets to external managers, while public pension funds award only 31%of assets to outside managers; average accounts given out by private and public pension funds were E262 million and E277 million, respectively; balanced portfolios have dropped sharply to 26%of all externally managed allocations from 45%in 1994.
Domestic equity allocations now comprise 18%of all those externally run, up from 10%four years ago. International equity accounts dipped one percentage point to a 27%market share. Passive allocations now are responsible for 13%of all external mandates, up from 9%in 1994. However, passive allocations tend to be larger than active ones, and the strategies now account for 21%of externally mandated assets, up from 12%four years ago.
Real estate fund sets sights on Southeast Asia
SINGAPORE -- Prudential Real Estate Investors has raised $430 million for its Asian Property Partners fund, which will be managed by the firm's Asian investment affiliate, Global Realty Advisors. The fund will seek opportunistic real estate investments in East and Southeast Asia, according to Bernard Winograd, CEO of Prudential Real Estate Investors. Initially it will target Hong Kong, Singapore and Thailand, but will consider investments throughout Asia. The fund expects to have the committed capital fully invested by December 2000. It has already invested $70 million, primarily in real estate operating companies in the region.
New Asia-Pacific indexes launched by Dow Jones
NEW YORK -- Dow Jones Indexes in July announced the Dow Jones Asia Pacific Extra Liquid Series, a set of equity indexes designed for retail and institutional investors seeking index-linked investments in the Asia-Pacific region.
Indexes based on Australia, Hong Kong and Japan will be the initial offerings in the AP/ELS series.
The indexes were designed with assistance from the Sydney Futures Exchange.
The first investment products based on the 35-stock Australia, 30-stock Hong Kong and 100-stock Japan Dow Jones AP/ELS indexes will include warrants, equity-linked notes and mutual funds.
Trading on the AP/ELS Australia index is scheduled to start in the third quarter, with trading on Hong Kong, Japan and a possible regional Asian index following in early 2000.
Trading on the indexes will take place on the SFE, using its 24-hour electronic trading system, SYCOM IV.
Dow Jones has also created a broader index made up of 150 components index for Australia, the Dow Jones global indexes-Australia, which is intended for use by fund managers and will have a high correlation with the 35-stock Australia AP/ELS index.
Japanese businesses improve corporate governance
WASHINGTON -- Japanese firms made significant strides in improving their corporate governance practices during the current proxy season, according to a study by Institutional Shareholder Services.
Of the 1,600 companies covered in June, ISS said, there were improvements in the number of independent outside directors, the disclosure of individual compensation levels for directors and top executives, the annual election of directors and the more timely release of proxy materials to shareholders.
"As one Japanese institution put it, 1999 is Year 1 for corporate governance in Japan," said Marc Goldstein, global analyst at ISS. "Investors have complained for years about Japanese companies' notorious late release of proxy materials for shareholder meetings. . . . With more than 2,000 companies holding annual meetings in late June every year, shareholders with more than a few Japanese firms in their portfolios have great difficulty in processing the information and making voting decisions on time.
"This year for the first time we saw a significant number of companies, including Sony Corp., Hitachi Ltd., Honda Motor Co. Ltd. and Nikko Securities Co. Ltd., releasing materials three weeks or more before the meeting date. Because of this, we in turn were able to deliver most of our analyses to institutional investors 15 days before the meeting date, a marked improvement over last year," he said