Compared with institutional investors in other countries, Dutch institutions are very receptive to investing in private equity and the largest pension funds in the Netherlands have been investing in private equity for some time, with ABP and PPGM investing in the asset class since 1996 and 1990 respectively. ABP has been an active private equity investor since it went public in 1996 and restrictions affecting investment in the asset class were relaxed.
A few years ago, ABP decided to increase its allocation to private equity from 2.5% of assets to 4%. Until recently, the scheme had an alternative asset allocation of 20% comprising real estate, private equity, commodities, hedge funds and specific active mandates in alpha funds.
With around e61.9bn under management, PGGM is the Netherlands’ second-largest pension fund after ABP and serves the country’s health sector workers. In late 1998 it joined forces with ABP (which is also listed) to buy state-controlled bank de Nationale Investeringsbank (NIB). The bank was later renamed NIB Capital and the private equity operations of all three groups have been merged, along with those of Alpinvest, which was acquired by PGGM and ABP in early 2000. Until recently, PGGM’s asset allocation to private equity was 7.5% (via NIB Capital Private Equity) but the scheme has recently altered its investment approach.
Five or 10 years ago only large Dutch pension funds were able to allocate to the asset class but now small and mid-size Dutch schemes are including private equity in their asset liability modelling. Yet, despite growing interest from pension funds, banks were the most significant investors in 2004. EVCA figures show that banks accounted for 26% of new private equity funds raised in the Netherlands, while insurance companies (18%) and funds-of-funds (16%) were also important contributors.

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