It is not only insurers that have grown to become successful third-party money managers. A number of pension funds have made a move that is paying off.
- Saker Nusseibeh, CEO at Hermes Fund Managers, the £26.9 billion manager that was established by the £40 billion BT Pension Scheme, London — which remains its owner and biggest client — told Pensions & Investments in June that he is working to diversify the client base. Currently, third-party assets make up 23.3% of the total assets under management, but with a combination of new teams and strategies, plus a refuelled engine to target U.S. institutional investors, Mr. Nusseibeh is hoping to change all that.
- The €167 billion ($223.8 billion) Dutch pension fund service provider, PGGM, grew out of Pensioenfonds Zorg en Welzijn, Zeist, the Netherlands. The pension fund for the care and welfare sector had e151.5 billion of assets as of June 1. The two were separated in 2008, and PGGM now manages assets for seven institutional clients, said Eloy Lindeijer, Zeist, Netherlands-based chief investment manager at PGGM. “Aside from scale and scope, the main benefit from contracting new and recontracting existing clients is that this brings discipline to our organization and processes, forcing us to remain a market leader in terms of quality, efficiency and breadth of services. We find that the experience and expertise of new clients is often beneficial to existing clients as well.” Mr. Lindeijer said about 11% of PGGM’s assets as of May 1, is accounted for by clients other than PFZW. He added there is no specified target for third-party AUM.