Private Equity in Prescribed Assets – A Primrose Path for Pension Funds?

Private Equity in Prescribed Assets – A Primrose Path for Pension Funds?

By GANDY GANDIDZANWA & ITAI MUKADIRA

Recent regulatory changes that have expanded the prescribed assets regime by according prescribed assets status to privately issued instruments has brought much hype and relief to the pension fund industry. It had been a long-time plea of the industry.

Private equity is one asset class directly benefiting from this regulatory relaxation. With a 20% minimum allocation requirement into prescribed assets, we can expect to see significant flows into prescribed assets status investments, of which private equity will likely command a sizeable chunk of it.

In the heat of the moment though, with all the hype and excitement, a word of advice to the trustees would be a noble gesture we think. Private equity investing, as with many other alternatives asset classes, is no walk in the park. With any risky asset class, pouring money into it does not necessarily mean that money will be poured back out, and private equity is no exception. Click the link below for the full articles Private Equity in Prescribed Assets – A Primrose Path for Pension Funds