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BlackRock expands Tax Transparent Funds for UK schemes

11 May 2017

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BlackRock is increasing its range of Tax Transparent Funds to meet the growing demand from UK pension funds.

The government introduced the TTF structure in 2013 as a tax transparent fund for institutional investors.

Since then, BlackRock said, there has been an increasing appetite among pension funds and insurance companies looking to maximise their withholding tax treatment in a cost efficient pooled fund structure.

The new range includes seven tracker funds, which are due to launch by June and will offer UK investors access to global equity markets.

The funds are: ACS World ex UK Equity Tracker Fund; ACS Japan Equity Tracker Fund; ACS Continental European Equity Tracker Fund; ACS UK Equity Tracker Fund; ACS 50:50 Global Equity Tracker Fund; ACS 60:40 Global Equity Tracker Fund; and the ACS 30:70 Global Equity Tracker Fund.

Custody, fund administration and trustee services of the funds will be provided by Northern Trust.

Claire Finn, head of UK DC at BlackRock, commented: "Since their introduction, pension funds and insurers have found the TTF structure effective in helping to manage the tax efficiency of their investments, while having the security, governance and scale benefits of investing through a pooled vehicle.

"The launch of these additional seven funds allows our clients to express a view on global equity markets in tax efficient way, while also providing a solution to the requirements of Solvency II."

The expansion announcement comes three years after BlackRock launched its first TTF range, the UK's first.

BlackRock says the new range will particularly appeal to its Local Government Pension Scheme clients.

"Our Local Government Pension Scheme (LGPS) clients in England and Wales are currently Pooling together their pension scheme assets," said Finn.

"TTF structures are an important consideration for the Pools and these funds will expand the range of available tracker investment funds."

First published 11.05.2017