Canada’s Public Sector Pension Investment Board (PSP Investments) has hired an executive with strong international experience as its new chief investment officer, which should prove useful given its plan to put its first office in Asia this year.
Eduard van Gelderen started as CIO at the $153 billiion ($118 billion) fund yesterday (July 30). He previously worked as a senior managing director on the investment team at the University of California’s $110 billion endowment fund and before that as chief executive of Dutch pension asset manager APG.
Van Gelderen replaces Daniel Garant, who left PSP in July last year, after which the CIO duties were overseen by chief legal officer Darren Baccus and chief executive Andre Bourbonnais. Bourbonnais himself left in February and was replaced by Neil Cunningham, the former head of real estate and natural resources.
PSP’s plan to add an Asia branch comes as other North American state retirement funds make their own pushes into the region to help oversee and make investments there. And the institution, like its peers, has a large and growing focus on private markets, with almost half (46.7%) of its AUM in such investments.
Moreover, Ontario Municipal Employees Retirement System (Omers) opened a branch in Singapore in January to add to its infrastructure-focused presence in Australia.
The C$95 billion fund now has around 10 staff in the city-state, including Bruce Crane, David Payne, David Matheson and Brijesh Chopra as managing directors overseeing infrastructure, private equity, real estate and capital markets, respectively.
They are joining the likes of Canada Pension Plan Investment Board, Ontario Teachers Pension Plan and Caisse de Depot et Placement du Quebec – the three biggest Canadian retirement funds – which have all had Asian operations in place for several years. So has APG, van Gelden’s former employer, which has €470 billion ($551 billion) under management.
US state pension schemes, however, have been slower to move in this direction; Texas Teachers would likely be the first of its peers to establish a local branch.
Some believe this may be the start of a further wave of such asset owners coming eastwards. US investors generally don’t have much exposure to the region apart from Japan, Hong Kong and Singapore, said Paul Colwell, Asia head of portfolio advisory at consultancy Willis Towers Watson. Hence Asian markets represent a great opportunity for US pension plans to diverslfy, he told AsianInvestor last month.
Given the size of the state funds in question, such moves are big statements of intent when it comes to investing in Asian assets, reflecting commitment to the region and faith in its growth potential.
Singapore-based Michael Rolland, who heads Omers Asia as president and chief operating officer for Asia Pacific, said last year that the office would be established to further diversify the fund’s international investments.
Meanwhile, Jerry Albright, CIO of Texas Teachers, told AsianInvestor in May that it made sense to have staff closer to the US fund’s $22 billion of assets in the region.
University of California (UC) will not replace van Gelderen in the office of the chief investment officer (OCIO), a UC spokeswoman told AsianInvestor by email.
Meanwhile, Samuel Kunz, managing director of asset allocation and investment strategy, and Ronnie Swinkels, director of public equity, will assume new responsibilities within the OCIO, the spokeswoman added.
Effective immediately, Kunz will lead the OCIO’s passive public equity investments, while Swinkels will head the office’s active public equity assets. Both will report directly to UC CIO Jagdeep Bachher.