Spain’s BBVA pension carves out first PE allocation

The employee pension of Spain’s second largest bank will start investing 5 percent of its €2.1bn pension fund in alternative assets.

Banco Bilbao Vizcaya Argentaria , Spain’s second largest bank after Santander, is to invest five percent of its employee pension fund in private equity and real estate, a bank spokesperson told sister website PrivateEquityRealEstate.com.

This marks a portfolio shift for Banco Bilbao Vizcaya Argentaria (BBVA), which has assets of €2.1 billion ($3.2 billion) representing more than 41,000 participants.

A spokeswoman for BBVA, whose pension fund assets are managed by BBVA Gestion de Activos, confirmed the change of direction for the bank to private equity and real estate. The bank would also consider hedge fund investments, she said. The allocation shift is expected to come at the expense of the bank’s fixed interest holdings.

The bank in 2001 teamed up with US-based Darby Overseas Investments to form Darby-BBVA Latin American Investors, a $250 million private equity fund targeting Latin America.