Sweden's AP Fonden 4 hires eight for Japan, Asia

AP Fonden 4, Stockholm, hired eight managers for a preapproved list of firms to run active Japan equity and active Asia-Pacific ex-Japan equity, confirmed Tobias Fransson, head of external mandates at the €19 billion ($24 billion) fund.

The managers are Absolute Asia Asset Management, AllianceBernstein, APS Asset Management, Capital International, DIAM International, Fidelity International, JPMorgan Asset Management and Schroders. At stake is up to €1.5 billion in assets; that money is now passively managed, with about 70% in Japanese equities and the rest in Asia-Pacific ex-Japan, Mr. Fransson said.

“It is likely that we may decide to increase the active risk of this portfolio,” said Mr. Fransson, referring to the combined Asia-Pacific strategy. “At this point, we haven't made any decisions on funding.”

In September, AP4 appointed BGI, SSgA and BlackRock to run its passive global equity portfolio, which includes the Asia-Pacific portion. Information on which managers were running the passive Asia-Pacific portfolio was not available at press time.

Chicago Municipal Employees' Annuity & Benefit Fund committed $25 million to Levine Leichtman Capital Partners IV, a structured equity partnership, pending negotiations, confirmed James Mohler, senior investment manager at the $7 billion system.

Levine Leichtman has about $4 billion in assets under management, according to the firm's website.

The A$660 million (US$464 million) ConnectSuper, Melbourne, Australia, restructured its fixed-income portfolio to assign two new mandates.

Credit Suisse will run A$10 million in a syndicated loans product, while Principal Global Investors will handle A$10 million in a strategic global income fund, as reported by Investment & Technology newspaper.

Funding will come from reducing Credit Suisse's diversified fixed-income portfolio to A$41 million.

“We see some real opportunities in credit markets. Both new positions should give us a little more octane in our credit portfolio,” said CEO Sean Leonard.

The Federal Reserve hired JPMorgan Chase to manage a new agency program to finance the purchases of assets from money-market mutual funds, said Susan Staywick, a Fed spokeswoman.

Under the program, JPMorgan will manage five pools that buy certificates of deposit, bank notes and commercial paper from money-market mutual funds. The Fed will lend up to $540 billion to the program.

A JPMorgan spokesman had no comment.

Federal Reserve Bank of New York hired PIMCO to serve as asset manager for its Commercial Paper Funding Facility. State Street Bank was named custodian and administrator for the program. The CPFF is being set up to ensure the smooth functioning of the U.S. commercial paper market, according to a posting on the website of the Federal Reserve Bank of New York.

The facility was to begin purchasing commercial paper on Oct. 27, for a six-month period, unless extended by the Federal Reserve's board of governors.

General Lighthouse Authorities for the U.K. and Ireland hired Hymans Robertson to “help modernize its pension arrangements,” according to a Hymans news release.

The authorities could soon be granted additional pension powers through the British Draft Marine Navigation bill, which, according to the release, “includes provisions to allow the setting up of a new funded pension scheme(s), which will put their pension arrangements on a firm footing for the long term.”

Jo Nussbaum, spokeswoman for Hymans Robertson, could not provide additional details, referring questions to John Wright, partner at Hymans, who was unavailable. A call to the Edinburgh-based Northern Lighthouse Board, a member of the GLA, was not returned by press time.

In addition to the Northern Lighthouse Board, Trinity House, London, and the Commissioners of Irish Lights, Dublin, are in the GLA.

London Pensions Fund Authority hired European Credit Managers to run £25 million ($43 million) in European corporate distressed debt, said Mike Taylor, CEO of the fund.

ECM already runs about £200 million in collateralized swaps within the authority's £1.3 billion liability-driven investment portfolio, which matches the liabilities of retired members. The rest of the authority's £3.7 billion in assets are managed in a higher-returns-seeking portfolio, including about £115 million in opportunistic investments.

The fund's staff can make opportunistic investments of up £50 million without prior board approval.

Los Angeles City Employees Retirement System committed $25 million to the ING Clarion Debt Opportunity Fund III.

The fund previously invested $25 million in ING Clarion Debt Opportunity Fund II.

The $8.5 billion system has a $1 billion target for high-yield commercial real estate and debt investments. PCA assisted in the hire.

Road Commission for Oakland County Retirement System, Beverly Hills, Mich., hired Independent Portfolio Consultants as consultant and manager of managers for the $165 million defined benefit plan, said Dennis A. Lockhart, trustee and plan administrator.

Mr. Lockhart would not identify the plan's previous consultant and money managers. According to Money Market Directory, Asset Strategies Portfolio Services provided consulting services and Invesco, C.S. McKee and Western Asset Management managed the plan's assets as of June 2007.

Mr. Lockhart said IPC began the transition to the new funds on Oct. 1.

Optimum Asset Management hired RBC Dexia Investor Services as global custodian and to provide fund valuation services for Optimum's new family of pooled funds, confirmed RBC Dexia spokesman Warren Weeks.

An Optimum spokeswoman could not be reached by press time.

The family of pooled funds include the Optimum Canadian Equity Pooled Fund, Optimum Global Equity Pooled Fund and Optimum Bond Pooled Fund, Mr. Weeks wrote in an e-mail response to questions. He could not provide the total assets in the fund family.

Optimum has C$2.3 billion (US$1.9 billion) in assets under management. RBC Dexia has US$2.8 trillion in client assets under administration.

Stanhope Pension Trust, Stafford, England, hired Redington Partners as investment consultant, confirmed Pete Harris, director of pensions at the £2.5 billion ($4.2 billion) fund.

The fund's previous adviser was Watson Wyatt Worldwide, which helped Stanhope implement a liability-driven investing strategy, Mr. Harris said. Watson Wyatt continues to provide actuarial services to the fund.

The hiring followed a periodic review by the fund.

About 80% of the plan's assets are invested in U.K. and overseas bonds. The remainder is spread among global equity, U.K. equity, real estate, hedge funds and leveraged loans, Mr. Harris said. The plan uses about 14 external managers.

The Treasury Department announced that Bank of New York Mellon was hired as the custodian for its $700 billion economic rescue package, BNY Mellon spokesman Kevin Heine confirmed.

BNY Mellon will provide the accounting for the portfolio, hold the portfolio's cash and assets, provide pricing and asset valuation services and assist with other related services. The company will also serve as auction manager and conduct reverse auctions for the troubled assets.

Also, Ennis Knupp was hired as investment management consultant for rescue package, said Neel Kashkari, Treasury's interim assistant secretary for financial stability.

Mr. Kashkari, who is heading Treasury's Troubled Asset Relief Program, said Ennis Knupp was selected from a field of six candidates.

Ennis Knupp will help evaluate potential asset managers and oversee those firms that are selected, according to a Treasury Department news release. “This oversight will include helping Treasury to determine asset allocations for each manager, evaluating the performance and costs, identifying conflicts of interest and identifying strategic investment and market issues impact the overall portfolio,” the news release said.

In addition, Ennis Knupp, under its one-year contract with Treasury, will identify qualified “minority- and women-owned businesses to provide services for the portfolio,” the news release said.

Harmony Watling, Ennis Knupp spokeswoman, said the firm doesn't comment on the work done for clients.

PricewaterhouseCoopers and Ernst & Young were hired to provide accounting and internal control services for Treasury's rescue plan, according to a separate news release.

PwC will help Treasury “establish a sound internal control posture” and Ernst & Young will provide accounting support and advice, the news release said. Their contracts expire Sept. 30, 2011.