Schroders receives approval to launch first Long-Term Asset Fund

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Schroders today announces it has received regulatory approval from the UK’s Financial Conduct Authority to launch the first Long-Term Asset Fund (LTAF).

LTAFs are regulated open ended investment vehicles designed to enable a broader range of investors, with longer term horizons, to invest efficiently in illiquid and private assets.

Schroders is already a market leader in offering structures which provide greater access to private assets through its range of listed vehicles, as well as semi-liquid and illiquid structures. Following today’s regulatory approval to launch an LTAF in the UK, Schroders Capital -  the private assets division of Schroders - will focus on providing defined contribution (DC) and other eligible investors with the opportunity to access the breadth of our private asset investment capabilities.

Going forward, LTAFs may also have a role to play in the UK wealth market, subject to the outcome of the ongoing FCA consultation on broadening access to long term asset funds.

Peter Harrison, Group Chief Executive, Schroders, said:

“We feel strongly that a wider range of UK savers must be able to take advantage of the robust returns and diversification benefits that investing in private assets can bring. There are some great industries and firms which could be further supported by long term capital. The LTAF structure is designed to address this and I am delighted that the imminent launch of Schroders first LTAF, which is the first to be approved in the UK, will enable these companies to start benefiting from big pools of long-term capital and, in turn, help long term savers.”

Tim Horne, Head of UK Institutional DC, Schroders, said:

“Private assets have the potential to help DC investors achieve their aims of a good outcome in retirement. The LTAF regime has been specifically designed to provide a regulated fund structure that provides a framework to invest into these assets. At Schroders we have been at the forefront of DC investment innovation and we are now focused on launching a private markets solution to best meet the needs of UK retirement savers.”

David Seex, Head of Private Asset Solutions, Schroders Capital, said:

“We are dedicated to innovating and providing our investors with ways to unlock the broadest range of investment capabilities. The LTAF regime is an exciting regulatory initiative that will allow pension savers to invest in private assets and we are focused on leading with our own solution.

“Of course, it is important for investors and their advisors to be clear as to the long term nature of private investments and when and how they will be able to access their funds. Key considerations should be the liquidity profile of their investment and how this fits with their investment horizon.”

With $91 billion [1]of assets under management, Schroders Capital provides investors with access to a broad range of private asset investment opportunities across the likes of real estate, private equity and infrastructure.

Enabling a wider range of investors to benefit from investing in private assets has been a key focus for Schroders; last year the firm took a significant step following its appointment by Nest, the UK’s largest workplace pension scheme, to manage a private equity DC allocation.

[1]*Assets under management as at 31 December 2022 (including non-fee earning dry powder and in-house cross holdings)

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