Alecta, Sweden’s largest pension fund, has announced this morning that it has found a replacement for departing CIO Hans Sterte in the shape of former ATP chief investment officer Henrik Gade Jepsen.
Gade Jepsen, who worked at Denmark’s biggest pension fund ATP for 17 years, including five as CIO and a period as interim chief executive officer, will start his job at Alecta on 1 December, the Swedish SEK1.12trn (€102bn) occupational pension fund said.
This will leave Alecta without a CIO for nearly three weeks after Sterte leaves on 11 November, but Alecta has already said its CEO Magnus Billing would perform the role in addition to his own ahead of a permanent CIO arriving.
Billing said: “I am very happy that Henrik is starting as the new head of Alecta’s investment management.
“His experience as a leader and deep knowledge in asset management will be very valuable for Alecta and for the execution of our mission,” he said.
Gade Jepsen – one of the most experienced and high-profile CIOs in Europe – was head of asset management at Danske Bank from 2016 to 2020 after leaving ATP, although his most recent role, Alecta said, is senior adviser at QBlue Balanced, the Copenhagen-based asset manager set up in 2018 by former ATP CIO Bjarne Graven Larsen, where a number of other ex-ATP staff also work.
In his earlier career, Gade Jepsen worked at the IMF in Washington and Danmarks Nationalbank, the Danish central bank in Copenhagen.
He described Alecta’s asset management model as ”exciting and in many ways unique”.
“For me, it is attractive to work together with a fairly small group of colleagues and to be able to get close to the various investments,” he said.
“At the same time, the role of head of asset management requires a great understanding of the overall development of both financial markets and society in Sweden and globally,” he said.
Asked if he was daunted by the task, given the current turmoil in financial markets, Gade Jepsen told IPE: “Obviously the market has had a strong tailwind over the last 10 years, and now the situation is challenging, but no, I’ve been in this business for a long time, and every five to 10 years you see something that seems very difficult.
“At ATP, we lived through three big crises and at this point we just don’t know – things could normalise fairly quickly,” he said.
On the other hand, Gade Jepsen said, as an investor it was no bad thing to be prepared for the worst.
IPE asked the incoming Alecta CIO what was now needed to succeed in growing pension assets.
“It’s very difficult to be safe, and especially regarding a big portfolio. So I think what you should look at are things like stringent risk management. For example, are there uncompensated risks in your portfolio that you could be hedging away? Or can you implement your strategies in a more cost-effective way? Or can you improve risk diversification?” he said.
“So there are big and small things, and you have to focus on what you control and accept that you cannot change the market. If the entire market is going down it is extremely difficult to avoid losing money, but using good risk-management techniques is probably the way to limit your losses,” Gade Jepsen said.
“I think that’s probably a more realistic way to look at things, rather than thinking you can take your risk down to literally nothing and then get back in when the time is right – which I think is very hard, especially when you’re running a big portfolio,” he said.
Gade Jepsen confirmed he was moving to Sweden for the new job, and would live in Stockholm.
“Definitely – you can’t run this from the distance, so yes I’m moving there. I’ve been to Sweden a lot, and Stockholm is fantastic,” he said.
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