AP7 continues SimCorp partnership
09 May 2023 Sweden
Image: Bits and Splits/stock.adobe.com
Swedish state pension fund Sjunde AP-Fonden (AP7) has renewed its mandate with SimCorp.
As part of the renewal, SimCorp will continue to be AP7’s investment management system provider.
SimCorp has provided technology services to AP7 for 23 years, with the process for this latest renewal initiated in September 2022.
AP7 currently manages more than SEK 900 billion (€80 billion) in assets under management, and is the pension fund used by approximately half of the Swedish population.
AP7’s primary investment focus is publicly traded stocks and bonds, however the company states that its investment portfolio is expected to evolve over the next few years. This is in part due to regulations introduced this year, whereby the firm will be able to allocate up to 20 per cent of its investments to alternative asset classes.
Further regulatory change is seen around sustainability, with the company obligated to manage its assets through responsible investments and ownership. While AP7 already dedicates a portion of its listed equity portfolio to climate and environmental solution-oriented companies, the firm has outlined its plans to develop a transition portfolio.
Tina Nylund, chief operating officer at AP7, says: “Everything from obtaining the necessary knowledge in-house to more practical questions such as how to make valuations will be areas that need to be addressed. For us, it is important to view the AP7 and SimCorp cooperation as a true partnership, and to have confidence that SimCorp’s products will be able to address not only today's needs but also new challenges in the future.
“The core process and the backbone for AP7 is to be able to calculate the net asset value for the equity fund and the fixed income fund on a daily basis. The whole fund administration side of the platform is of great importance to us.”
As part of the renewal, SimCorp will continue to be AP7’s investment management system provider.
SimCorp has provided technology services to AP7 for 23 years, with the process for this latest renewal initiated in September 2022.
AP7 currently manages more than SEK 900 billion (€80 billion) in assets under management, and is the pension fund used by approximately half of the Swedish population.
AP7’s primary investment focus is publicly traded stocks and bonds, however the company states that its investment portfolio is expected to evolve over the next few years. This is in part due to regulations introduced this year, whereby the firm will be able to allocate up to 20 per cent of its investments to alternative asset classes.
Further regulatory change is seen around sustainability, with the company obligated to manage its assets through responsible investments and ownership. While AP7 already dedicates a portion of its listed equity portfolio to climate and environmental solution-oriented companies, the firm has outlined its plans to develop a transition portfolio.
Tina Nylund, chief operating officer at AP7, says: “Everything from obtaining the necessary knowledge in-house to more practical questions such as how to make valuations will be areas that need to be addressed. For us, it is important to view the AP7 and SimCorp cooperation as a true partnership, and to have confidence that SimCorp’s products will be able to address not only today's needs but also new challenges in the future.
“The core process and the backbone for AP7 is to be able to calculate the net asset value for the equity fund and the fixed income fund on a daily basis. The whole fund administration side of the platform is of great importance to us.”
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