SSS increasing exposure in capital markets

The Social Security System (SSS) recently announced it would hire three local fund managers as part of its plan to increase exposure in domestic capital markets.

In a statement, the SSS said it would tap fund managers “to help diversify its portfolio and benchmark on comparative investment classes.”

This will be the first time that the state-run pension fund would hire fund managers.

According to SSS, each of the three fund managers to be contracted would handle P1 billion in investible funds to be allocated into a mix of equity and fixed income securities.

The SSS said companies aiming to bid for its fund management contract should be duly licensed with at least five years of experience.

Also, applicants are required to have minimum assets under management of P10 billion in equities as well as P25 billion in fixed income securities as of the end of 2013.

Applicants may submit their eligibility documents to the SSS head office in Quezon City until Nov. 18.

The SSS noted that hiring external fund managers is allowed under Section 26-A of Republic Act No. 8282 or the Social Security Act of 1997.

Last May, SSS president and chief executive Emilio S. de Quiros Jr. said that bringing in fund managers would help the pension fund at least meet or even surpass its revenue targets.

This year, the SSS eyes revenue of P34 billion—deemed as a “conservative” goal as the agency recorded P38 billion in net revenue exceeding the 2013 target of P36 billion, de Quiros said.

Revenues generated by the SSS come mainly from members’ contributions and investment gains.