ABP Loses Chairman | Chief Investment Officer

(May 22, 2014) — The chairman of the largest Dutch pension fund has announced he is to step down at the end of the month for personal reasons.

Henk Brouwer was appointed to lead the trustee board of ABP, the pension fund for Dutch civil servants, in January 2012. He had been a director of the Dutch National Bank, which also regulates the pension industry, since 1997.

The news comes a day after the €309 billion pension announced 2013 had been “an eventful year” in its annual report. A year ago, 2012 was termed “difficult”.

In a statement to accompany the report, Brouwer said the fund had dealt with many challenges: “New rules, a new contract, and a discussion on the future of the system.”

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However, ABP’s coverage ratio increased in 2013 by more than nine percentage points, from 96.6% to 105.9%, the report revealed. Assets increased by €20 billion and liabilities decreased by €8 billion. Investments in developed markets were up 22.1% and private equity investments gained 17.5%. The fund’s assets are managed by dedicated asset manager APG.

The report also mentioned that the fund was pleased not only with the quantitative outcomes of its investment strategy, but also that it had been able to engage with major companies to improve governance quality.

Brouwer signed off his introductory letter to the annual report by saying that those running the fund would continue to do so with “lots of energy”.

(May 22, 2014) — The world’s biggest sovereign wealth fund, the Norway Pension Fund—Global, is seeking to diversify into private equity and infrastructure.

The fund is lobbying the Norwegian government to allow it to allocate a portion of its $860 billion portfolio into the two asset classes, according to Bloomberg. It currently holds predominantly equities and fixed income, as well as a 5% position in real estate, overseen by Karsten Kallevig, CIO for real estate.

A spokesperson for the Norway Pension Fund could not be reached for comment at the time of going to press.

Speaking to aiCIO in 2012, Petter Johnsen, CIO for equities at the fund, talked of moving into “private investments” in “long-term, more illiquid positions”, a step on from the fund’s current ability to invest in listed companies and pre-IPO offers.

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“There will be a change of emphasis in our investment ideas to take more advantage of being a large investor,” Johnsen said at the time.

Elroy Dimson, emeritus professor at London Business School and chairman of the fund’s investment strategy board, also said in 2012 that there was “no reason, in principle, why [the fund] cannot harvest an illiquidity premium from public equity”.

Johnsen said infrastructure had “attractive characteristics”, while Dimson added: “After moving 5% into real estate, the fund will have established the skill to look at and invest in illiquid assets—infrastructure could conceivably be the next step. However, there are so many people investing in it now, prices are very high.”