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NEWSLETTER

Pension funds pick up the bill for last year’s mini budget, while fintech investors eye up insurance opportunities

As we finally say goodbye to January – officially the most depressing month of the year – for UK pension funds the future still looks bleak as trustees continue to count the cost of last year’s disastrous mini-budget.

This week the Work and Pensions Select Committee heard that funds following liability-driven investment strategies, and which were subsequently forced into selling gilts during September’s bond market meltdown, have lost as much as GBP4 billion.

This week, IAM talks to Mark Stanley, director at investment manager Payden & Rygel, who says those trustees burnt by the mini budget debacle will be looking to repair the damage.

Stanley says multi-sector fixed income portfolios offer both liquidity and attractive yields; two critical ingredients for a final salary funds looking to repair deficits and ultimately buy out.

Moving from the traditional world of final salary pensions to the fast pace of fintech with the news that insurance is the latest industry to undergo an innovation overhaul.

Augmentum Fintech has invested EUR3 million in Berlin-based cyber insurance platform Baobab, which provides underwriting, pricing and risk mitigation services, and works with security providers to prevent breaches for what Augmentum CEO Tim Levene calls the “underserved SME market”.

This is the first investment in the insurtech space by Augmentum, in a portfolio comprising 25 private fintech companies, covering different fintech verticals, stages of maturity and geographies.

Levene paints an optimistic outlook for the fintech sector predicting “significant growth potential” with an average year-over-year revenue growth rate of 102 per cent for the portfolio’s top five portfolio companies.

Elsewhere BNY Mellon is offering to take trading off the buyside’s hands freeing them up to focus on “long-term growth and competitiveness”.

BNY Mellon Capital Markets offers a global multi-asset trading service which the company says will provide fee-constrained asset managers “operational and strategic efficiencies, savings and expansion”.

Keeping with the outsourcing trading theme, Nick Evans interviews Jack Seibald – managing director and global co-head of prime brokerage and outsourced trading at Cowen, winners in the 2022 Institutional Asset Manager awards, who talks about the increasingly competitive market and outlines the investment bank’s strategy plans to keep ahead of the pack by continuing to grow into new markets.

Finally, in people news, Lennertz & Co, the owner-managed multi-family office, announced two senior hires to help manage recent business growth.

Angelina Gaede joins as head of fund administration, while Caroline Militzer is appointed head of Human Resources (HR).

Gill Wadsworth, Editor

LATEST NEWS

Asset manager Payden & Rygel underlines the case for fixed-income investments.
Powered by a buy-side trading culture and a flexible range of solutions that can be tailored to all types and sizes of investment managers, Cowen has long been a leader in the now fast-expanding area of outsourced trading. In an interview with Institutional Asset Manager, Jack Seibald – managing director and global co-head of prime brokerage and outsourced trading at Cowen – outlines the investment bank’s strategy and its plans for continued growth into new markets, geographies, and asset classes.
Augmentum Fintech plc, Europe’s publicly listed fintech fund, has provided an update on its portfolio and announced that it has led a funding round into Berlin-based cyber insurance platform Baobab, with a EUR3 million investment.

IN MY OPINION

Jason Yablon, head of US real estate, and Rich Hill, head of real estate strategy and research at Cohen & Steers, write that there was a dramatic performance difference between listed and private real estate in 2022.
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