Weekly Wrap: January 24 edition

Institutional investors can plug building gap

FTfm: Pension funds, insurance companies and other institutional investors could provide the $200bn (£120bn) a year of infrastructure investment needed to plug a global gap, research from Standard & Poor’s Rating Services has found. “We believe institutional investors’ allocations to infrastructure could rise to an average of around 4 per cent, four times their current level,” said Mike Wilkins, managing director of project finance at S&P.

UK to shelve pensions cap for a year

FT: Pensions minister Steve Webb has confirmed a delay to the proposed charges cap for funds used by workers in auto-enrolment schemes. Webb told delegates at the CBI’s 2014 pensions conference that the reform would be put back to April 2015. The industry had warned that the government was “creating hugely significant practical and operational risk” for its auto-enrolment pension programme by introducing the cap.

Schemes seek dynamically managed multi-asset funds

MandateWire: Nearly half (49 per cent) of defined contribution default funds now include diversified growth or multi-asset funds, according to the National Association of Pensions Funds’ annual survey. The use of dynamic asset allocation by DGF managers to reduce downside risk during 2008 and the eurozone crisis in 2011 has led to increased pension fund client interest.

UK investment recovery at ‘early stages’

FT: Britain is in the “very early stages” of a business investment recovery, said Ian McCafferty, a member of the Bank of England’s Monetary Policy Committee. He gave two reasons for his optimism about business – confidence is growing and access to external and internal sources of finance have improved thanks to higher profits, more bank loans and less problematic pension deficits. 

Michigan governor proposes $350m commitment to Detroit

FT: The governor of Michigan has proposed a deal that would see the US state commit up to $350m over 20 years to help Detroit pensioners and preserve the city’s world-class art collection. But governor Rick Snyder was adamant that the commitment was not a “bailout” of Detroit. The funding for the package would come from the multi-state settlement with US tobacco companies.

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Social media comment of the week 

@danmikulskis @pensions_expert @redingtontweets including May-July 2013?

— Drago Indjic (@dindjic) January 23, 2014