Press releases
LGIM launches Secure Income Assets Fund for professional UK Defined Benefit pension schemes
3 Aug 2020
- Aimed at professional UK Defined Benefit pension schemes with long-term time horizons
- Single point of access to diversified portfolio of private market securities
Legal & General Investment Management (LGIM) has launched a range of Secure Income Asset Solutions for investors seeking income over the longer term.
The Legal & General Secure Income Assets Fund has an open-ended pooled structure subject to a lock-in period. The fund is designed for professional UK defined benefit pension schemes looking for stable, long-term cashflows by targeting return of gilts +2.5% per annum over a rolling three-year period, from a diversified portfolio of secure income assets, including infrastructure debt, real estate debt and private corporate debt.
For those UK pension schemes seeking a more bespoke solution, five single strategies have also been launched as separate unit-linked life funds:
- Legal & General Senior Real Estate Debt Fund
- Legal & General Investment Grade Infrastructure Debt Fund
- Legal & General Investment Grade Private Corporate Debt Fund
- Legal & General Sub-Investment Grade Infrastructure Debt Fund
- Legal & General Sub-Investment Grade Private Corporate Debt Fund.
All the Funds within the Secure Income Asset Solutions range have an open-ended pooled structure subject to a lock-in period, which enables clients to invest in secure income assets without facing any additional governance burden. This is particularly relevant for smaller schemes that may find such asset classes ordinarily out of reach due to the higher minimum investment and governance required. The flexibility of the offering means it can be adapted to suit clients’ liability hedging, cashflow matching and liquidity purposes.
Through its Real Assets platform, LGIM is one of the UK’s largest real assets managers, actively investing in, and managing, assets across commercial, operational and residential property sectors, as well as infrastructure, real estate, corporate and alternative debt.
With more than £35.1 billion of assets under management, LGIM Real Assets has built and retained a strong track record of out-performance, seeking to protect the medium to long term value of its portfolio, with green principles embedded into every property and investment decision.
Mark Johnson, Head of UK Institutional Clients at LGIM: "The launch of the Secure Income Assets Fund meets the growing demand from our UK DB scheme clients for innovative solutions that deliver reliable income. Investing long-term capital in secure income assets offers a compelling opportunity to generate these cashflows with attractive risk-adjusted returns and the potential for long term owners of capital – insurers and pension schemes – to effect real and lasting change."
Stuart Hitchcock, Head of Portfolio Management, Private Credit, at LGIM Real Assets: "For investors with a long term view, secure income assets are a core part of a cashflow-driven investment strategy, delivering a breadth and depth of universe not available in the public market. By negotiating better structural protections than public market equivalents, we aim to provide improved downside protection, reduced valuation volatility and lower correlation with traditional traded assets.With £14 billion AUM, our Private Credit business has seen considerable success across corporate, infrastructure and real estate debt. We have invested in some of the UK’s largest economic and social infrastructure, alongside renewable projects and real estate - our focus is to deliver significant financing to both the public and private sector, in order to serve our investment clients’ cash flow needs, while making a positive social impact."
Further information
Tom Green
JPES Partners
T: 0207 5207 633
Key risk warning
The value of an investment and any income taken from it is not guaranteed and can go down as well as up; you may not get back the amount you originally invested.
Notes to editors
Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor, with over £1.2 trillion in total assets under management* of which a third is international. We also provide powerful asset origination capabilities. Together, these underpin our leading retirement and protection solutions: we are a leading international player in pension risk transfer, in UK and US life insurance, and in UK workplace pensions and retirement income. Through inclusive capitalism, we aim to build a better society by investing in long-term assets that benefit everyone.
*at 31 Dec 2022
Legal & General Investment Management
Legal & General Investment Management is one of Europe’s largest asset managers and a major global investor, with total assets under management of £1.29 trillion1. We work with a wide range of global clients, including pension schemes, sovereign wealth funds, fund distributors and retail investors.
For more than 50 years, we have built our business through understanding what matters most to our clients and transforming this insight into valuable, accessible investment products and solutions. We provide investment expertise across the full spectrum of asset classes including fixed income, equities, commercial property, and cash. Our capabilities range from index-tracking and active strategies to liquidity management and liability-based risk management solutions.
1Globally, we manage assets of £1.42 trillion or CHF 1.75 trillion as at 31 December 2021 (source: LGIM internal data as at 31 December 2021). The data combines assets under management by LGIM in the UK, LGIMA in the US and LGIM Asia in Hong Kong. Assets under management include securities and derivatives positions.
*at 11 Jan 2023
KEY RISKS
Past performance is not a guide to the future. The value of an investment and any income taken from it is not guaranteed and can go down as well as up, you may not get back the amount you originally invested. For illustrative purposes only. Reference to a particular security is on a historical basis and does not mean that the security is currently held or will be held within an LGIM portfolio. The above information does not constitute a recommendation to buy or sell any security. Views expressed are of LGIM as at 3 January 2023.
IMPORTANT LEGAL NOTICE
In the European Economic Area, it is issued by LGIM Managers (Europe) Limited, authorised by the Central Bank of Ireland as a UCITS management company (pursuant to European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 2011 (S.I. No. 352 of 2011), as amended) and as an alternative investment fund manager with "top up" permissions which enable the firm to carry out certain additional MiFID investment services (pursuant to the European Union (Alternative Investment Fund Managers) Regulations 2013 (S.I. No. 257 of 2013), as amended). Registered in Ireland with the Companies Registration Office (No. 609677). Registered Office: 70 Sir John Rogerson's Quay, Dublin, 2, Ireland. Regulated by the Central Bank of Ireland (No. C173733).
LGIM Managers (Europe) Limited operates a branch network in the European Economic Area, which is subject to supervision by the Central Bank of Ireland. In Italy, the branch office of LGIM Managers (Europe) Limited is subject to limited supervision by the Commissione Nazionale per le società e la Borsa ("CONSOB") and is registered with Banca d'Italia (no. 23978.0) with registered office at Piazza della Repubblica 3, 20121 Milan, (Companies' Register no. MI - 2557936). In Germany, the branch office of LGIM Managers (Europe) Limited is subject to limited supervision by the German Federal Financial Supervisory Authority ("BaFin"). In the Netherlands, the branch office of LGIM Managers (Europe) Limited is subject to limited supervision by the Dutch Authority for the Financial Markets ("AFM") and it is included in the register held by the AFM and registered with the trade register of the Chamber of Commerce under number 74481231.Details about the full extent of our relevant authorisations and permissions are available from us upon request. For further information on our products (including the product prospectuses), please visit our website.