Scottish Widows is preparing to launch an open-architecture Long Term Asset Fund (LTAF) later this year, pending regulatory approval, with Aberdeen Investments appointed as an initial manager of the growth sub fund.
“The LTAF will provide access to the full universe of private market investments and will offer new investment options to over four million workplace pension customers across the UK, two important steps that Aberdeen believes are vital if private markets are to be truly democratised,” said Aberdeen.
Aberdeen is a leading player in private markets and alternatives, with £70 billion in assets under management as at December 31, 2024. As a group, Aberdeen manages and administers more than £500 billion.
Aberdeen Investments CEO Xavier Meyer said: “The diversification benefits of private markets have come into sharp focus at a time of volatile equity and bond markets.
“These benefits have been historically limited to institutional investors and a handful of high-net-worth individuals. Scottish Widows’ LTAF is a meaningful step towards the democratisation of private assets, and we fully share their ambition of enabling millions of UK customers to access such capabilities through their workplace pension proposition.
“We are proud of being part of this initiative, and grateful for the trust that Scottish Widows has placed into our long-standing private market expertise.”
Scottish Widows CEO Chira Barua said: “Private assets can be an attractive component of a modern portfolio structure for helping our customers achieve good outcomes in retirement.
“It’s also a brilliant win-win as it supports economic growth by providing funding to companies with bespoke financing requirements.
“As one of the UK’s largest workplace pension providers and part of a group whose core purpose is helping Britain prosper, this is an important building block in our endeavour to offer the most distinctive pension proposition in the UK.”
Kevin Doran, Chief Investment Officer of Scottish Widows, said: “Our open-architecture implementation approach gives us full control and future-proofing on how and where we invest within our LTAF.
“The opportunity to source unique investment opportunities from across the Lloyds Banking Group estate only adds to the offering, meaning our policyholders will be able to see their investments at work within their local communities.
“With full control of our own sponsored vehicle, we have the visibility of cash flows from members’ contributions, right through to asset flows. This limits the need for precautionary liquidity, making sure our members get the full benefit of their investments in private assets.”