The Swedish Fund Selection Agency (FTN) has presented preliminary procurement specifications for two actively managed Nordic equity fund tenders.

One of the funds will primarily focus on large- and mid-cap companies and the other will primarily focus on small cap. Notice will be given at the same time for both procurements but FTN has not specified when this will be. FTN recently revealed the results of its European equities tender, awarding six fund managers contracts for the premium pension fund platform.

The fund with a primary focus on large- and mid-cap companies covers approximately SEK 9bn in premium assets, whereas the fund focused on small-cap companies covers approximately SEK 13bn in premium pension assets. Overall, the two procurements will affect approximately 176,000 pension savers.

Furthermore, both procurements apply to actively managed funds with a minimum permitted tracking error of 2 per cent against the fund's benchmark. The maximum permitted tracking error is 4 per cent for the fund's benchmark index relative to the procurement's category index.

Both procurements are for Undertakings for Collective Investment in Transferable Securities (UCITS) funds with trading currencies in SEK, NOK or EUR and the funds report according to the Sustainable Finance Disclosure Regulation (SFDR) Article 8 or Article 9.

On the fund platform, there is currently only one category for Nordic equity funds that consists of 17 funds, but FTN’s decision means that the existing category will be split into two separate procurements. Fund managers wanting to participate in both procurements will have to submit two different tenders.

Due to the announcement of the procurements, the fund agreements for funds in the existing category will be terminated. However, the funds will remain on the fund platform until procurement is completed.

The final and governing specifications will be presented when the procurements are announced. FTN has shared the preliminary procurement specifications to allow potential tenderers to prepare and submit questions and comments.

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