Royal Mail Pension Plan appoints BlackRock to manage DB assets

The Royal Mail Pension Plan (RMPP) has selected BlackRock to manage its £8.8bn defined benefit (DB) scheme assets as an outsourced chief investment officer.

As part of the appointment, members of RMPP’s investment team will move to BlackRock and continue to manage the scheme’s investments, while being able to benefit from the scale and risk management capabilities of a full-service asset manager.

The transfer of staff and assets was completed yesterday (1 February).

Commenting on the news, RMPP chief executive officer, Richard Law-Deeks, emphasised that the trustee's main priority, "as ever", is to "ensure the retirement benefits of our members are well managed and protected".

He continued: “Our in-house team has delivered strong investment performance during some challenging markets over the last twenty plus years, meaning we are well funded. It is now time to consider how to lock in the stability and continuity of this position.

“With this agreement, we ensure that key institutional knowledge is retained, while benefitting from BlackRock’s wider expertise and scale. We have long worked with BlackRock and look forward now to deepening that partnership further.”

BlackRock head of UK business, Sarah Melvin, added: “We’re proud to be entrusted with managing the RMPP's assets. The scheme has been run exceptionally well by the in-house team to date and we’re excited to welcome them to BlackRock to continue to serve the plan’s evolving needs.

“BlackRock has been partnering with businesses as an outsourced chief investment officer since 2005, helping schemes meet their objectives and providing financial security for their members. We manage the savings of over 11 million people in the UK, and we believe strongly in putting people’s retirement needs at the heart of everything we do.”

Royal Mail is also planning to introduce a new collective defined contribution (CDC) scheme to replace the RMPP, which closed to future accrual in 2018, with the new collective plan expected to launch in early 2023, after Royal Mail previously confirmed that it had applied to The Pensions Regulator (TPR) for authorisation.

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