France's Fonds de Réserve Pour les Retraites (FRR) has shown its support for the Capital Markets Union (CMU) with its first investment in high-rated securitised assets.
Its supervisory board met in June 2025 and approved the principle of making initial investments in European investment-grade securitised assets, up to a limit of €200m.
The pension fund said the decision was “part of a two-pronged approach” to further diversify the FRR's bond portfolio while contributing to the development of the CMU in Europe.
The targeted assets, rated between AAA and BBB, will consist of portfolios of European loans to the real economy, in particular residential real estate loans, consumer loans, and loans to businesses, including SMEs.
“Through this initiative, the FRR intends to take advantage of the additional return offered by these instruments, while ensuring a rigorous selection of assets and leading structures,” it stated.
“The aim is to gradually acquire specific expertise in this complex but high-potential asset class, within a European regulatory framework that has been strengthened since the 2008 crisis.”
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