The £1.6bn ($2.7bn) UK Tyne & Wear Pension Fund (T&W) has finalised its investment reshuffle in a bid to bolster specialist management capacity - a move it says is mirroring the current trend in the UK pension fund market.

Phillips & Drew (P&D) was the final manager reviewed in the tender process, holding on to its £500m UK active balanced mandate after the T&W board expressed satisfaction with both service and performance levels.

Previously the T&W fund was split on a two thirds active balanced basis, run by P&D and Mercury, with the remainder managed as a separate consensus index tracking portfolio run by Barclays Global Investors. Specialist mandates in this portfolio were held by Capital International (European equities), JP Morgan (US equities) and Schroders (Far East and Japanese equities). The portfolio split is now 50-50 balanced/specialist, after CU Morley scooped a £150m specialist UK equities brief and the remaining specialist mandates were increased.

Ian Bainbridge, loans and investment officer at T&W, says: Overall our belief in the specialist approach, borne out by several years of quality and good performance, prompted us to take things a step further. It appears to reflect a general move in the industry from balanced to specialist investment mandates."

In a similar move T&W has appoint-ed Bankers Trust as custodian for £80m of its European equities and RBS Trust Bank to cover a £150m portion of Fidelity's balanced portfolio. The remainder of T&W's custody will be carried out by the affiliated custodians of its investment managers. Hugh Wheelan"