Dutch building scheme sticks to ‘expensive’ PE, hedge funds

first_imgBpfBouw, the €63bn Dutch scheme for the building sector, has stated it will keep investing in “expensive” asset classes such as private equity and hedge funds, “as their high management costs also mean risk reduction through returns and diversification”.In its annual report for 2019, it said that higher costs through a larger allocation to illiquid assets are justifiable, because the investments contributed positively to its risk-return profile.Although private equity and hedge funds made up no more than 7% of the fund’s entire investment portfolio, the combined costs comprised almost half of the scheme’s asset management costs of 55 bps last year.The asset classes, however, had delivered net returns of 22.2% and 6.9%, respectively. BpfBouw closed 2019 with a funding level of 112.4%It added that it had raised its contribution for 2020 by 2 percentage points to 22.2%, after a five-year period of stable premiums.However, it suggested that a further rise next year will be likely, as lower allowed assumptions for future returns must be factored in.The pension fund closed 2019 with a funding level of 112.4%, enabling it to grant its participants and pensioners an inflation compensation of 0.26%.In April 2020, its coverage ratio had fallen to 108.7%.BpfBouw has 146,545 active participants, 371,095 deferred members and 250,870 pensioners, affiliated with 13,105 employers.To read the digital edition of IPE’s latest magazine click here. BpfBouw said it had already reduced private equity costs through a selection programme for investments, in order to limit performance fees in funds of funds.It added that it had decreased management fees for hedge funds by 27% during the past five years by negotiating service fees.That said, performance of both asset classes fell short of their respectively benchmarks last year, with private equity underperforming 8.8 percentage points and hedge funds 1 percentage point.The pension fund reported a net overall return of 17.9%, an underperformance of 0.9 percentage point.As most of its investments are actively managed, it said it will raise the issue of underperformance with its asset manager, APG.Residential propertyThe building scheme attributed the 11.7% gain on its 16.9% real estate portfolio largely to the performance of residential property.It said that its Dutch Residential Fund had exceeded its benchmark during the past five years.It added that its international investments – comprising almost one-third of its property portfolio – had also outperformed, thanks to an overweighting to residential property, in particular in Germany, China and North America.The pension fund said equity had generated 26.7%, and added that the underperformance of 2.6 percentage points was due to its quantitative and focus strategies.Its 42% fixed income allocation had delivered 9.2% as a consequence of falling interest rates, in particular in Italy, Spain and Portugal, according to BpfBouw.It said that profits of 9.6% and 15%, respectively, for high yield credit and emerging market debt were the result of quantitative easing of central banks.BpfBouw’s holdings of inflation-linked bonds and non-listed infrastructure projects gained 5.3% and 21.4%, respectively.The scheme cited recovering oil prices as well as increasing value of precious metals as the main causes for a 18.7% return on commodities in 2019.last_img read more

Local teams compete at Class B indoor track championships

first_imgLEWISTON — The Class B indoor track season came to an end Saturday with the state championship meet at Bates College.Ellsworth, Mount Desert Island and George Stevens Academy were scored as teams in the boys’ and girls’ events. MDI’s girls’ team finished eighth, and GSA and Ellsworth finished tied for 11th and 19th, respectively.On the boys’ side, MDI finished sixth, Ellsworth tied for 12th and GSA tied for 22nd. Matt Shea finished third of 14 runners for Ellsworth in the 1-mile run with a time of 4 minutes, 50.50 seconds.Greely won both the boys’ and girls’ meets. John Bapst took second place on the boys’ side, and Brewer was runner-up on the girls’ side.This is placeholder textThis is placeholder textlast_img read more

Court Holds Ministry of Foreign Affairs in Contempt

first_imgThe continuous absence of lawyers of the Ministry of Foreign Affairs (MOF) at the Commercial Court for the hearing of their case yesterday was enough for Judge Chan-chan A. Paegar to charge the Ministry for disrespecting the court.Judge Paegar took the decision immediately after lawyers for Semah Group of Companies, seeking over US$4.8 million in damages from Winrock International and USAID, both US-based entities, for breach of contract, asked him to do so.The Ministry was mandated by Judge Paegar on numerous occasions to ensure that the two US institutions appear before the court to answer to Semah’s allegation, but their lawyers have failed to comply with the court’s order.Taking the action yesterday, Judge Paegar granted Semah’s legal team’s request to hold them in contempt for continuous non-appearance.Judge Paegar further warned that the Ministry should appear before him today to show reason why they should not be held in contempt for their failure to attend his scheduled hearing, although they received and signed notices asking them to do so.The Commercial Court judge did not mention any punishment for disrespecting the court’s order; instead, he instructed his clerk to again communicate with the Ministry so that they can attend their contempt hearing, which he scheduled for today.The case emerged after Semah Group of Companies filed a lawsuit against Winrock International and USAID at the Commercial Court for breach of contract.In its lawsuit, Semah is seeking US$4.5 million in general damages “for psychological effect and disparagement” and an additional US$379K in specific damages and “total contract price.”In the lawsuit, Semah Group stated that it entered into a contractual agreement with the respondent on May 1, 2014, for the construction of a biomass electricity pilot project.Semah further indicated that the initial contract was valued at US$296,535.56 on July 18, 2014, noting that seven modifications to the original contract were initiated and effected with an additional cost of US$82.5K, thus increasing the contract value to US$379,043.37.The document further contended that the duration of the initial contract was from May 1, 2014 to September 30, 2014, but that due to the Ebola crisis in Liberia, including quarantines and closure of borders on September 29, 2014, the said contract was extended to October 14, 2014.Semah said to their surprise, the defendants breached the contractual agreement by advertising the same contract for the construction of the Kwendin Biomass Project in violation of the contractual agreement between them.Share this:Click to share on Twitter (Opens in new window)Click to share on Facebook (Opens in new window)last_img read more