Pension fund management services

Tender description

GMPF is seeking to establish a Framework of active multi-credit managers. The managers must be capable of managing: either Mandate A and B, as mutually exclusive separate mandates; or Mandate A alone. Mandate A: A multi-credit mandate, with a target long-term return likely to be in the region of LIBOR plus 4 % — 6 % per annum measured over discrete 3 year periods. This mandate, which is expected to be in the region of 650 000000 GBP, will seek to invest in higher yielding public credit opportunities (which can also extend to include thos ein relation to private placement markets). It is likely that a segregated approach will be the preferred solution for this mandate, although pooled solutions will be considered. The aim of this mandate is to generate meaning full absolute returns principally based on the income available from a diverse credit portfolio. Hedge fund solutions will not be considered. It is anticipated that the mandate will invest in multiple categories of higher yielding debt (i.e. we expect any exposure to lower yielding investment grade credit or government bond markets to be a function of ‘downside protection’ rather than for income generation). We expect currency to be hedged to Sterling and any interest rate (duration) risk to be minimal given the floating rate and short duration nature of much of the investment opportunity set. And; Mandate B: A higher quality credit oriented mandate, with a target return likely to be in the region of LIBOR plus 2 % per annum over discrete 3 year periods. For the purposes of this tender, you should assume an initial mandate size of around 100 000 000 GBP; however, this has the potential to significantly increase over time. The mandate is likely to invest in higher quality debt related investments (with an expected average credit rating of ‘A’), including potentially an element of investment grade buy and maintain credit. It is likely that a segregated approach will be the preferred solution for this mandate, although pooled solutions will be considered. The aim of this mandate is to build a portfolio of assets that can generate cash flows to form part of a liability cash-flow matching strategy. It is anticipated that the mandate will invest in a number of shorter-dated credit related opportunities, including loans and high yield debt. Hedge fund solutions will not be considered. We expect currency to be hedged to Sterling and any interest rate (duration) risk to be minimal given the floating rate and short duration nature of much of the investment opportunity set.