Performance

Credit lines are contentious but their ability to improve IRR appears limited to the most strongly performing funds and funds early in their life, writes Christoph Jäckel of Montana Capital Partners.

Pooled net returns of European private equity and venture capital funds in US dollar terms dropped 76% in the first quarter of 2019 from a year ago, according to data from ILPA and Cambridge Associates.

ATP PEP will ask GPs to provide an IRR that has been adjusted to compensate for the use of subscription credit lines, managing partner Torben Vangstrup told PEI.

The £287m NAV trust posted £25.4m of total realisations and income in H1 2019, down from £29.9m at the same point last year.

Private equity must outperform all other strategies for the pension plan to reach its assumed rate of return, says chief investment officer Dhvani Shah.

The pension system is combining alternative assets into one pool and will re-assess all GP relationships, trimming for better strategic partnerships.

LPs are changing their approach to PE performance as they seek to ensure ongoing alignment with GPs.

Private equity was the third-best performing asset class for the past year, behind Australian listed property at 19.4% and global listed infrastructure at 14.9%.

The asset manager still expects to cross $100bn in total capital inflows in 2019, having already raised $64bn so far this year.

The asset class was still the second highest return generator, and the pension system is expanding its programme to help achieve a 7% actuarial rate of return.