The blooming of the cherry trees in my favourite local street heralded the arrival of spring − the picturesque froth of pink flowers signalling renewal. This month I wrote the latest in a series of blog posts looking at the challenges facing asset managers. It explained how the rapid rise in interest rates has been good for the funding positions of closed DB pension schemes and finance directors’ mental health, but it is more challenging for asset managers. My latest article for MandateWire looked the implications for asset managers of the great buyout bonanza. The next sustainable networking event will be taking place in April – get in touch if you would like to attend.
The great unwind
My latest in a series of blog posts continues to look at the challenges facing asset managers. In this post I include a fabulous U-shaped chart of Bank of England interest rates rapidly collapsing in the aftermath of the global financial crisis and then rising equally fast in recent years. This reversal in interest rate fortunes has been great for closed DB funding positions and the mental health of company finance directors but more challenging for asset managers. With a rapid acceleration in the buy-out journey of so many pension schemes, the opportunities for asset managers have narrowed with fewer schemes now needing growth assets.
Insurers could outsource overseas assets amid buyout boom
What are the implications for asset managers of the great buyout bonanza? With annual estimates of around £50bn a year to be transferred from DB schemes to insurance companies, my latest feature for MandateWire looks at the challenges and opportunities this presents asset managers. While an insurer’s investment portfolio is broader than that of a closed private sector DB scheme, many of those assets will be managed in-house. Asset managers will need to offer products where the insurance company lacks in-house expertise but will have to ensure these mandates match an insurer’s regulatory requirements. Not every scheme, however, will be able to go to buy out so there is an opportunity for asset managers to offer products which help to maintain their strong funding position.
Latest sustainable networking event
The latest sustainable networking event will take place in mid-April and will be the latest in a new format. We will be discussing how to make net zero a reality. Rather than focusing just on the challenges facing institutional investors, this event will be broader to include what policy is needed and how businesses need to be supported as well as how investors can help. If you would like to come along, please get in touch!
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