NETHERLANDS – The €300m Bpf AVH scheme, covering 15,000 workers in the agricultural wholesale trade, has turned to Barclays and State Street for passive management, following an “insufficient performance test”.

“On account of its Z-score record Bpf AVH has decided to change its asset management structure. In this structure nowadays passive management is emphasized,” the fund said in a statement.

Erik Martens, the fund’s managing director, told IPE the fund used to employ ABN Amro as sole asset manager until 2004, when Barclays took over the bond portfolio and State Street took on equities.

The fund’s allocation to bonds and equities is 80:20, but the asset allocation will change in July this year, as alternative investments are introduced, Martens said.

Martens said the fund is considering real estate investments in the Netherlands, hedge funds and possibly commodities. But he was unable to quantify the size of the mandates.

He said he would take a final decision at the end of the month, bearing mind the risk involved and new Dutch financial assessment framework, FTK.

He added that the fund would chose its hedge funds and real estate managers from two six-strong short-lists.

The change from growth management to a passive strategy was triggered by the fund’s negative Z-score, which is a measure for Dutch funds’ performance against their benchmarks. The score was –0.23% in 2004.

Martens explained the strategic decision saying that assets had been actively managed since 1998 by ABN Amro. But in 2002 AVH faced a –2.25% Z-score.

“In that year Bpf AVH could limit the loss with an asset mix of 20% equities and 80% bonds,” he said.

In 2001 the multi-employer fund posted a –0.33% performance, the next year –2.10%. In 2004 returns went back to positive with a 4.53% performance, which grew to 6.90% in 2004.