GIPF scores success

The Government Institutions Pension Fund (GIPF) has announced the success of its new multi-manager policy approach to investments led by RisCura.
By September last year GIPF posted an average return on investments of 16,78%, well ahead of the average achieved by Namibian balanced fund managers of 12,79%. In market value terms this means that the fund has grown to a staggering N$48,5 billion after benefit disbursement.

Riscura was appointed in March 2010, and is a multi-manager investment company known for handling large funds. On Monday, the fund explained that it has outperformed Namibia’s best balanced fund managers consistently over the last 12 months. According to Jarred Glansbeek, CEO of RisCura, using actuarial calculations which measure the needs of all GIPF members, and takIing into account the rules of the scheme, inflation over time, demographics of the population, ongoing fund solvency and the ability to meet its commitments time, his company is able to identify and use the best fund managers for specific funding options.

“It is clear that not all asset managers have skills in all asset classes,” he pointed out, emphasising the benefits for using the best managers in their respective classes.

“The GIPF’s fundamental change in strategy significantly improves the trustees’ ability to harness skill. This is by selecting the best asset manager for any asset classes,” he explained.

GIPF spokesman Elvis Nashilongo also addressed the burning issue of local and unlisted investments, saying that the controversial Development Capital Portfolio (DCP) has been replaced by a new Unlisted Investment Policy. This three part system will see GIPF’s unlisted investments made in unlisted shares and shares listed on the Development Capital boards of stock exchanges within Africa the Namibian Stock Exchange (NSX) Development Capital board. No less than 15% of its total assets are earmarked for unlisted and local investments amounting to N$6,5 billion as at September 2011.

The new policy requires that special interest vehicles in the form of Bewind Trusts be created for each of the new investments. The Bewind Trusts will be run by boards of trustees with skills particular to the mandates of the investments. Also the relationship between selected fund managers and the Bewind trustees will be guided by specific management agreements. Nashilongo explained that at least 1% of the required capital will come from fund managers and co-investors. Profit sharing will be done on an 80/20 basis, with GIPF gaining 80% of all profits. Funds invested will always remain property of the GIPF and all funds are disbursed only as needed.

So far, VPB Namibia and IJG/African Alliance have been identified as vehicles for private equity investments, while Enablis and SME Compete will serve as venture capital vehicles and Old Mutual as infrastructure investors. Investec, FNB, BFS and Kongalend are in line for debt financing. Property investments will be made with Safland, Old Mutual’s Omignam-Tunga fund and Sanlam Investment Managers. Koningstein and Preferred Management Services will be funded for project development. Letshego, First Capital and NHE are to be used for core, low cost and mortgage of housing investment.

click to enlarge GIPF PROGRESSIVE INVESTMENT: Jarred Glansbeek shows how the GIPF has managed to outperform Namibian balanced fund managers to grow beyond a whopping N$48,5 billion level © Augetto Graig