French civil servant pension fund ERAFP has launched a call for tenders to renew its foreign currency hedging mandates.
One active mandate and two stand-by mandates are up for grabs, with a notional hedging volume of approximately €3bn.
ERAFP delegates most of its asset management to external asset managers, with mandates regularly put out to tender.
It said foreign exchange risk management at the consolidated portfolio level aimed to address three essential objectives: the reduction of overall exposure to foreign exchange risk by decreasing exposure to foreign currencies; better coordination of exchange hedging; and a reduction in the cost of this hedging.
The mandates are for four years, with the option for ERAFP to extend them for up to two additional two-year periods.
Last month Russell Investments was appointed to ERAFP’s foreign currency hedging mandate, taking over from Millennium Global Europe. A spokesperson for ERAFP said the pension fund was activating its standby mandate as Millenium was closing its activities in France.
At the time a spokeperson for Millennium said: “Millennium Global is in the process of centralising its European activity in London, enabling the business to benefit from regulatory exemptions across many EU countries. The group continues to grow, with over $28bn in hedged assets.”
Asset managers can bid for the new mandates until 1 July at 12 noon (Paris time).
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