The $205 million Tauranga-based BayTrust is in the final phases of reviewing its investment adviser with a decision expected before year-end, according to chief executive, Alastair Rhodes.
Rhodes said the trust should confirm an appointment this side of Christmas barring unforeseen delays.
It is understood the candidate list had been whittled down to two, including incumbent Russell Investments.
“We regularly go to market to ensure our investment adviser best fits with the needs of the trust,” he said.
During the 2016/17 fiscal year the BayTrust kitty tipped above $200 million for the first time, the latest annual report says, closing out the period with $205 million under management.
The community trust also upped “growth asset allocations from 45% to 55% including an exposure to global listed infrastructure” in the last financial year under a change implemented this May.
“With forecast returns expected to be lower looking forward, this change to a higher growth portfolio, whist likely to slightly increase the volatility within BayTrust’s portfolio, is also expected to increase returns ensuring our granting remains meaningful in the future,” the annual report says.
Currently, BayTrust is also increasing its private equity allocation to 10 per cent from 5 per cent allowing the fund to diversify “from predominantly NZ focused investments to include a global exposure” in the asset class.
At the same time, the trust has lifted the ‘impact investing’ portfolio component to 6 per cent from the previous 3 per cent.
“These changes are designed to both tap into higher returns and the illiquidity premium associated with Private Equity which is a natural fit for BayTrust as a perpetual Trust, and to more actively invest in growing NZ and BOP investments driving social impact as well as financial returns compared to our previous largely passive NZ investment strategy,” the report says.
Rhodes said BayTrust had already invested about $4 million of ‘impact’ funds in two community housing projects via low interest loans to help locals buy homes.