Interview – Barry Kenneth
INTERVIEW – BARRY KENNETH
“It is difficult to deploy capital when you have a market in freefall.”
Barry Kenneth, chief investment officer of the Pension Protection Fund (PPF), talks to Mona Dohle about managing market volatility, investing through a crisis and working from home.
How is the PPF managing the impact of Covid-19 on a practical level? We have been working from home for about four weeks now and our IT depart- ment has done a great job in arranging that transition. We have access to analyti- cal tools, so from a practical perspective we have most things we need to help sof- ten the blow. What is more challenging is not being together in the same office. I like to inter- act with people face-to-face. It helps with decision making and keeps
everyone
focused on the same outcome and ena- bles us to hear different voices. I am a bit old school; I prefer to interact with people directly. We now have to plan meetings or calls if we want to talk. It works as well as it
16 | portfolio institutional May 2020 | issue 93
could, and we are managing the portfolio pretty efficiently.
We are facing a challenging economic environment, so are you anticipating a rise in defined benefit schemes needing to join the PPF?
If the government and the central bank had not committed the levels of support that we have seen, UK industry would be a lot more vulnerable.
The interesting questions are, how long will we be in lockdown? For how long is our industry effectively going to stay closed? What will be the operating model when we come out of this pandemic? What is clear is that it will be very differ- ent to the one we had going into this crisis.
Could the PPF handle such an increase in demand?
Onboarding any set of assets is challeng- ing. When I joined the PPF six years ago, our assets were £10bn and they are now north of £35bn, so we have been on a growth spurt. That means our model and our processes are established, so if we were to assume a significant bunch of assets it would not worry me from an operational perspective.
The other side of that is if corporates become insolvent and go into the assess- ment period, it takes one to two years before they are set up and hit our con- trolled assets. We would tend to plan before insolvency if there is a scheme on our radar and during the assessment we work closely with the trustees to evolve
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