The fund is prioritising infrastructure investments, both domestically and offshore, as it seeks to ensure long-term sustainability and significant returns for its members.
BPOPF CEO Moemedi Malinda told BusinessWeek that the pension fund has already identified aligning interests and is actively working on several high-value deals. Some of these opportunities have been successfully closed, while others are still in progress. However, the hunt for more continues, with the fund dedicating specialised resources to this effort.
"We have a dedicated infrastructure specialist in the market, and we also have a manager who is actively looking for new opportunities," he said.
While infrastructure is the primary focus, BPOPF is open to investments across various sectors.
"We are trying to invest across different markets. It’s challenging to pinpoint a specific market we are developing because we are open to opportunities in roads, agriculture, water, energy and more," he said.
The fund’s strategy reflects a need to deploy capital quickly in sectors where returns can be realised promptly. Given the significant growth in offshore investments, BPOPF is under pressure to comply with its 2024 targets.
"We really need big moves around infrastructure to meet our goals. It’s going to be difficult for other asset classes to accommodate the volume of money we have coming in," Malinda said.
Government has facilitated access to lucrative infrastructure deals for BPOPF, such as a P1.4 billion project that has generated considerable excitement within the fund. These opportunities are aligned with BPOPF’s investment strategy, which is designed to balance risk and return, taking into account the nature of the pension fund.
"Our investment strategy is principled, developed with input from actuaries to determine the optimal level of risk that will deliver the best returns for our members," he added.
This strategy also takes into consideration the age and retirement timelines of members, ensuring that risks are managed appropriately. The fund reports its risk profile to the board every quarter, and any deviations from the established risk appetite are promptly corrected.
As the fund’s membership ages, BPOPF anticipates a significant increase in retirements.
"As we age, more exits are expected, and these will be substantial as many people are retiring in large numbers," the spokesperson explained.
This demographic trend further underscores the importance of securing large-scale, high-return investments to maintain the fund’s growth and stability.
The BPOPF’s proactive approach to securing big-ticket infrastructure deals is a key part of its strategy to ensure continued growth and robust returns for its members. With government support and a clear investment focus, the fund is well-positioned to navigate the challenges ahead.
