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Defined Contribution

U.K.’s NEST reports 59% increase in assets for 12 months

National Employment Savings Trust, London, boosted its assets 59% in 12 months to £2.7 billion ($3.8 billion) as of March 31.

The U.K. government-backed multiemployer defined contribution plan, known as a master trust, is also now managing assets on behalf of 6.4 million participants and 616,000 employers up from 4.5 million members and 327,000 employers a year earlier.

NEST delivered an average annualized return of 8.8% after all fees over the last five years for funds in the growth phase of the default strategy.

In the past 12 months, NEST's investments in equities increased to £1.4 billion, from £841 million in 2017 as of March 31. Bond investments were boosted to £873 million, from £506 million; property investments increased to £262 million, up from £202 million; while cash increased to £147 million, from £112 million.

NEST also increased its allocation to UBS Life Climate Aware World Equity Fund in the growth and foundation phases of its default funds to £357 million as of March 31, from £156 million a year earlier.

"NEST continues to grow and have a positive influence on the retirement prospects of our millions of members. We have performed well to-date, operating a well-run scheme which puts our members' interests first and foremost," said Otto Thoresen, corporation chairman, in a news release.

CEO Helen Dean added in the release: "Staging (of auto enrollment) has been a once-in-a-lifetime event and a unique challenge. At its peak, we saw more than 1,800 employers sign up to NEST in a single working day, compared to 500 per year at earlier stages of auto enrollment."

"We've also helped lead the way in developing our innovative retirement date funds and responsible investment strategies," she added. "We don't want to settle for doing the minimum but are finding ways to help drive improvements right across the pensions industry."