AMSTERDAM — The Netherlands' two pension giants look set to become asset management powerhouses as well.
The €194 billion ($246 billion) ABP, Heerlen, and the €74.5 billion PGGM, Zeist, are considering spinning off their asset management and administrative functions. That would make them among the largest money managers in the country in terms of assets under management, with ABP at €155.2 billion and PGGM at €37 billion.
"This will have profound implications for the strategic direction and ownership of these businesses," said Marko van Bergen, managing director, Barclays Global Investors, Amsterdam.
The two new firms could win business from other pension plans or even be sold to other commercial money managers or administrators.
Officials at neither plan would comment beyond saying discussions were still at an early stage.
Stichting Pensioenfonds PGGM announced last month it was in discussions to separate asset management and administration activities into a subsidiary owned by the pension plan. The move will enable the plan to sell insurance and other retail products to its members, said PGGM spokeswoman Ellen Habermehl. The operations currently are considered self-administered under Dutch regulations. Further details on the new structure and the future of PGGM's investment management business will be released in November, said Ms. Habermehl.
PGGM and Stichting Pensioenfonds ABP each was fined an undisclosed amount by the Dutch Central Bank late last year after they offering to sell pension plan participants insurance, in violation of regulations that forbid sales of such products by pension plans to their own participants. PGGM's Ms. Habermehl would not comment; ABP is appealing the fine, said ABP spokesman Hans ten Brinke.