UK pension funds hand over more assets to LDI managers
Transfer of assets is a pre-emptive move to avoid repeat of September’s collateral crunch, trustees say
After the near collapse of the UK liability driven investment sector, LDI managers are coaxing pension funds to hand over additional assets to meet collateral calls more easily.
Pension funds were hit by a wave of capital calls after the UK’s so-called mini budget in late September with the Bank of England forced to step in to avoid a selloff in gilts.
UK chancellor Jeremy Hunt will announce revised budget plans tomorrow. Pension funds, meanwhile, have been putting in place fixes of their own
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