Government plans to put pension funds to work funding infrastructure are at risk as the liquidity crisis continues.
Last year the UK regulator approved a new type of fund that enables investments in long-term, illiquid assets, including venture capital, private equity, private debt, real estate and infrastructure.
The “long-term asset fund” structure was designed to give infrastructure projects greater access to capital from investors such as pension funds, which have a longer-term investment horizon.
But the recent maelstrom around the bond markets has severely dented hopes that the funds would become the drivers of growth.
“The capacity of the pension fund industry to be a buyer of illiquid assets has taken a blow,” said Kerrin Rosenberg, chief executive of Cardano, an advisory firm and investment manager.
