1. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
What will European and
UK Pension Funds do
next?
1
Robert Gardner
4th Annual Inflation Conference

2. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
UK Pensions Today
30 Year Nominal Gilt Yield
2
0
1
2
3
4
5
6
7
8
9
30-YearNominalGiltYieldin%
High
17th May 2002
=5.12%
Low
31st Dec 2008
=3.70%

3. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Liability Driven Investment
Maximize your Toolset
3

4. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012 4
Source: Bloomberg, Redington
Liability Driven Investment
30-Year Gilt Real Yield

5. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Setting Clear Goals & Objectives
Good Governance=Ability to Act
5
Attaining Agility
Instituting good governance and
staying on top of market developments
gives pension funds the Agility to take
advantage of opportunities and risks.
Taking Control
A solid framework for making decisions
that incorporates long-term goals and
risk constraints puts pension funds in
Control.
Achieving Transparency
On-going monitoring of progress and
risks gives pension funds the
Transparency to make the right
decisions.
“ACT enables clients to
manage their risks
effectively, exploit
attractive opportunities
and ensure progress
towards full funding.”

6. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Setting Clear Goals & Objectives
The Pension Risk Management Framework
6

7. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Setting Clear Goals & Objectives
The Flight Plan from “set and forget” to “anticipate and react”
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2012 2013 2014 2015 2016 2017 2018 2019 2020
GBPMillions
Liabilities Path Actual Liabilities Assets Path Actual Assets
Time Horizon
Liability Basis
Contributions & Asset Returns

8. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Setting Clear Goals and Objectives
The PRMF Dashboard
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9. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Credit Spread and Gilt Yield Evolution
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Source: Redington; Bloomberg, Bank of America Merrill Lynch.
-100
0
100
200
300
400
500
600
bps
Sterling IG 15+ Corporate Spread 20-Year Gilt Real Yield IG Spread + Real Yield

10. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
The Fixed Income Universe
10
Numbers refer to the approximate size of each investment
universe ($trn).
Source: Redington; Barclays (IG, ABS); iBoxx (Subfins); Babson Capital (High Yield, Lev Loans, CLOs); Bluebay Asset Management, Stone Harbor Investment Partners (EM).

11. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
The Case for Unconstrained Fixed Income: 2006-2012
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12. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
The Case for Unconstrained Fixed Income: Today
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13. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
Flight Plan Consistent Assets
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Social Housing
Traditional Infrastructure Ground Rents
Secured Leases
Examples of FPCAs

14. Private & Confidential BNP Paribas' 4th Annual Inflation Conference 20 September 2012
13-15 Mallow Street London EC1Y 8RD Telephone : +44 (0) 20 7250 3331 www.redington.co.uk
Contacts
Robert Gardner
Founder & Co-CEO
Direct Line: +44 (0) 20 7250 3416
Telephone: +44 (0) 20 7250 3331
robert.gardner@redington.co.uk
14
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 in this message is indicative only, is subject
to change and is not an offer to transact. Where
relevant, the price quoted is exclusive of tax and
delivery costs. Any reference to the terms of executed
transactions should be 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 party a
duty of care in this respect.
Redington Ltd are investment consultants regulated by
the Financial Services Authority. We do not advise on
all implications of the transactions described herein.
This information is for discussion purposes and prior to
undertaking any trade, you should also discuss with
your professional tax, accounting and / or other relevant
advisers how such particular trade(s) affect you. All
analysis (whether in respect of tax, accounting, law or of
any other nature), should be treated as illustrative only
and not relied upon as accurate.
©Redington Limited 2012. All rights reserved. No
reproduction, copy, transmission or translation in whole
or in part of this presentation may be made without
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Registered office: 13-15 Mallow Street London EC1Y
8RD
Risk Management Firm of the Year
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Year 2012
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