Sweden’s official procurement agency for the revamped premium pension system funds platform announced the results of its second and third tender processes this morning, saying its work had reduced average fees on the funds that will now be offered to pension savers by more than half.
The Swedish Fund Selection Agency (Fondtorgsnämnden, FTN) is in the process of converting the €100bn all-providers premium pension funds platform to one where only procured funds are offered. It today revealed Handelsbanken, Mercer, Skandia, Storebrand and Swedbank Robur as the winners of new mandates to provide global equity index and European equity index funds.
In all, the awards concern SEK67bn (€5.8bn) of investment business – as at the end of last month, SEK51bn was invested in global equity index funds on the premium pension funds platform, and SEK16bn in funds in the European equity index category.
Mats Dillén, FTN chair, said: “The Swedish Fund Selection Agency has now completed a total of three procurements, including the two recent awards, marking a significant step toward a fully procured fund platform.”
Erik Fransson, executive director of the agency, said global index funds – which make up 4.2% of all assets currently invested on the platform – were an important foundation for many long-term pension savers, and the agency welcomed the outcome of the procurement that lowered the fees for all savers in the category.
“Premium pension savers will now have access to high-quality index funds at fees normally only available to large professional investors,” Fransson said.
The agency picked six funds offered by five managers in the global equity index category, and four funds from four managers in the European equity index category.
Of the 14 fund management firms submitting tenders for the global equity index fund category, Handelsbanken Fonder was offered a mandate for two funds, and Mercer Global Investments Management, Skandia Fonder, Storebrand Asset Management, and Swedbank Robur Fonder each for one fund.
In the tender for the European equity index funds category, 11 management firms submitted tenders and four were offered mandates, each for one fund.
The successful firms in that category were Handelsbanken Fonder, Skandia Fonder, Storebrand Fonder and Swedbank Robur Fonder.
This means there will be a reduction in the number of privately-managed funds offered to Swedish pension savers in the first-pillar pension system, since there are currently 11 funds available in the global category and seven in the European category.
Fee compression
The competitive process saw reductions in average fees for funds offered on the platform to 0.046% for both categories of fund, from previous levels of 0.143% for global equity funds and 0.135% for European funds.
The FTN is holding a digital live briefing on Tuesday at 10am local time for fund managers, about the 2025 procurement plan and ongoing procurements.
Earlier this week the agency said it was extending the deadline for submitting tenders in its procurement for actively and passively-managed Swedish equity funds by a week to 14 November, due to “adjustments to the mandatory requirements in the Request for Proposal”.
This follows the one-week extension announced in September.
Read the digital edition of IPE’s latest magazine
No comments yet