The Banking and Strategy Initiative

Chillin' out till it needs to be funded

Goldman Sachs picks up Old Mutual block in retirement funds | Deal Insight

We have it directly from the wires, as Goldman Sachs has just completed a deal to add $ 42 bln in its funds management division under Stable Value Funds ( Retirement assets). Old Mutual was exiting assets in the US to pursue improved Capital for its England/Africa core assets

According to Business week, Retirement assets have grown to $17 tln in the US of which $4.3 tlna re in Defined Contribution investments. Defined Benefit models have bled many public employers and Defined Contribution schemes incl Social security cannot offer fixed benefits from their plans depending on market variability and thus avoiding being short on future obligations, amon gother obvious advantages in freedom to invest across asset classes, depending on fund charters

Scudder is up for sale by Deutache Bank which was being bid by JP Morgan among others with another $56 bln in assets. DB wants to sell  slightly lesss than $400 bln in assets and JP Morgan was probably looking for a very cheap ticket to the marketplace. Other bidders include Power Corp , Macquarie and Guggenheim

Goldman Sachs Group Inc. agreed to buy Dwight Asset Management, a Vermont-based stable-value money manager, from Old Mutual Plc as it expands retirement offerings for investors. Terms were not disclosed.

Dwight, which manages and advises about $42 billion in assets, is scheduled to become part of Goldman Sachs Asset Management in the second quarter, the New York-based bank said in the statement.

The purchase “enables us to deliver more investment solutions to help defined-contribution plan participants preserve and grow their hard-earned retirement savings,” said Eric S. Lane and Timothy J. O’Neill, co-heads of Goldman Sachs’ investment management unit, in a statement today.

Stable value funds seek to preserve capital by investing in bonds and are offered in about half of all defined-contribution plans, according to the Stable Value Investment Association. There are about $540 billion in assets in such funds, according to the Washington-based organization.


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This entry was posted on February 7, 2012 by in Financial Markets and tagged , , , , , , , .


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