1. Redington
13-15 Mallow Street
London EC1Y 8RD
T. 020 7250 3331
www.redington.co.uk
twitter.com/redingtontweets
NAPF Manchester
Key Themes for Pensions in 2012
Robert Gardner, Redington
23rd February 2012

2. 2
Contents
1. Market Update
• Gilt and swap rates
2. Key (Investment) Themes for Pensions in 2012
• Liability Driven Investment (LDI)
• Setting Clear Goals & Objectives
 Importance of Strong Governance = Ability to ACT
 The Pensions Risk Management Framework
 Dynamic De-Risking
 Flight Plan Consistent Assets and UK infrastructure
3. Social Media and #Pensions
• An overview of using social media personally and professionally;
• And how to use social media to communicate, engage and educate key stakeholders:
 Facebook
 Twitter
 LinkedIn
 RedBlog
 Mallowstreet

3. 3

4. 4
Market Update
30-Year UK Gilt Yield

5. 5
Market Update
UK & Japan 30-Year Swap Rates

6. 6
Key (Investment) Themes for 2012
Liability Driven Investments (LDI) : Maximise Your Toolset

7. 7
Key (Investment) Themes for 2012
Good Governance = Ability to ACT

8. 8
Key (Investment) Themes for 2012
The PRMF Dashboard

9. 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
GBPMillions
―Actual Liabilities
∙∙∙ Assets Path
- - - Liabilities Path
―Actual Assets
9
Key (Investment) Themes for 2012
The Flight Plan: From ‘set and forget’ to ‘anticipate and recalibrate’
Source: Redington

10. 10
Key (Investment) Themes for 2012
Case Study: Dynamic De-Risking
Funding level comparison
01/10/2010 – 07/09/2011
Fundinglevel
Source: Redington
Strategy Funding level
Funding level
volatility
Original 70.6% 18%
Low risk allocation 71.8% 16%
Dynamic de-risking 76.2% 13%
As of 7 September 2011:

11. 11
-6
-4
-2
0
2
4
6
8
0 5 10 15 20 25 30
GBPMillions
Years
Initial investment
Attractive real
returns
Inflation-linked
cashflows
Providing a match for
liabilities
Inflows
Outflows
Source: Redington
Key (Investment) Themes for 2012
Flight Plan Consistent Assets: Cashflows

12. Key (Investment) Themes for 2012
Case Study: Cambridge Water
12
Cambridge Water
• Economic environment has small impact on returns
• Inflation-linked cashflows and returns
• Low regulatory risk
Water Infrastructure: Key Attractions
Image source: BM
Image source:
Cambridge First
Image source:
Cambridge Water
• Bought by HSBC in August 2011 (for
warehousing) for £74m
• Provides water for 300,000 people in
Cambridgeshire
• 2010/2011: Revenue of £20m with pre-tax
profits of £7m
• No external debt bar revolving credit facility

13. 13
Questions?

14. Social Media in the #Pensions Space

15. Social Media in the Pensions Space
Facebook

16. Social Media in the Pensions Space
Twitter #Pensions

17. Social Media in the Pensions Space
LinkedIn

18. Social Media in the Pensions Space
RedBlog

20. Community Membership Growth

21. Contacts
Disclaimer
21
Contacts
Direct Line: +44 (0) 20 7250 3416
Telephone: +44 (0) 20 7250 3331
Redington
13-15 Mallow Street
London EC1Y 8RD
Robert Gardner
Founder & Co-CEO
robert.gardner@redington.co.uk
www.redington.co.uk
THE DESTINATION FOR ASSET & LIABILITY MANAGEMENT
Disclaimer For professional investors only. Not suitable for private customers.
The information herein was obtained from various sources. We do not guarantee every aspect of its accuracy. The information is for your private information and is for discussion purposes only. A variety of market
factors and assumptions may affect this analysis, and this analysis does not reflect all possible loss scenarios. There is no certainty that the parameters and assumptions used in this analysis can be duplicated with actual
trades. Any historical exchange rates, interest rates or other reference rates or prices which appear above are not necessarily indicative of future exchange rates, interest rates, or other reference rates or prices. Neither
the information, recommendations or opinions expressed herein constitutes an offer to buy or sell any securities, futures, options, or investment products on your behalf. Unless otherwise stated, any pricing information
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treated as preliminary and subject to further due diligence .
Please note, the accurate calculation of the liability profile used as the basis for implementing any capital markets transactions is the sole responsibility of the Trustees' actuarial advisors. Redington Ltd will estimate the
liabilities if required but will not be held responsible for any loss or damage howsoever sustained as a result of inaccuracies in that estimation. Additionally, the client recognizes that Redington Ltd does not owe any
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