The Dutch pension asset manager's Asia Pacific head of real estate says his team has just had one of its busiest years ever and that 2021 is looking similarly promising.
The amount represents the balance from the $1 billion overseas investment mandate it earmarked and planned to award last year under a global investment programme, marking the GSISÆs first foray into international capital markets. ING Investment Management and Credit Agricole Asset Management (Singapore) received the first batch of overseas investment mandates from the GSIS in November 2007, but they were given only $300 million each.
So far, 30 international fund managers have submitted proposals to manage all or part of the latest $400 million mandate, which will be awarded before the end of 2008, says Omelita Tiangco, executive vice-president of the GSISÆs finance sector.
The GSIS decided to ask for new proposals instead of relying on the ones submitted last year due to the change in the investment climate over the past 12 months that has had a significant impact on strategies, Tiangco says.
GSISÆs basic requirements for fund managers is a minimum annual return on investment of 8% û net of fees û and a ceiling of 7% on annual portfolio volatility, which were also what was required during last yearÆs search. The fund managersÆ track record on an absolute return basis is also a key consideration.
The GSIS hasnÆt set any parameters for asset or geographic allocation, but is aiming for a geographically diversified overall portfolio.
The $1 billion that the GSIS has allotted for its global investment programme makes up around 12% of GSISÆs total loans and investment portfolio. GSIS president and general manager Winston Garcia has said that amount is just a starting point, and the figure will likely increase over time. Eventually, the GSIS plans to outsource the management of its funds, Garcia says.
The GSIS will have a tough time generating returns for its members if it continues to stick with Philippine shares because of limited choices and relatively low volume. Low interest rates and the absence of a strong secondary fixed-income market in the Philippines are also constraints.
ING and Credit Agricole beat seven other global fund managers for the mandates that they received last year. ING proposed an asset allocation that includes a mixture of global high dividend, global property securities, global fixed income and alternative investments. Credit Agricole proposed an asset allocation that includes global bonds, Asian equities, global equities fund and cash equivalents.
Fund managers that made it to GSISÆs shortlist during last yearÆs search included BNP Paribas, Credit Suisse Asset Management, Deutsche Asset Management, Northern Trust Global Investment, Pacific Investment Management Company, Goldman Sachs, and Societe Generale.
Sunsuper and QSuper appoints CIO for combined entity; State Street appoints heads of HK and Taiwan; Nothern Trust rebuilds Apac team; Manulife IM names emerging markets fixed income CIO; RBC Wealth Management hires four into HK; Lombard Odier hires two senior equity managers; Allianz Global Investors appoints Asia hand as equity CIO; and more.
Investors from China and the US are expected to continue buying assets in each other’s markets despite the blacklist of Chinese firms with military and surveillance ties.
Stronger government actions are needed to meet the Paris Agreement goal of limiting global temperature rise to 1.5 degrees, investors such as Hesta and CDPQ signed in a statement.
AsianInvestor explains why we chose the winners of the second half of our 2021 fund manager winners, by major local markets.