OAKS, PA — SEI (NASDAQ: SEIC) and WTW Investments are expanding their partnership to develop private-markets investment structures for 401(k) and other U.S. defined contribution plans, part of a broader effort to make alternatives such as private credit more workable within retirement accounts.
The collaboration combines WTW’s investment research and portfolio implementation capabilities with SEI Trust Company’s trustee, operational and administrative infrastructure for collective investment trusts, or CITs.
WTW will provide investment and operational due diligence and research for private-markets strategies used in retirement-focused CITs and evergreen investment structures. WTW has also selected SEI Trust Company to support certain retirement offerings delivered through CITs.
The firms are working on additional products and structures intended to accommodate private-market investments within defined contribution plans, where liquidity, governance and administration requirements can make alternative assets more difficult to implement than in institutional portfolios.
The expanded relationship reflects increasing efforts within the retirement industry to adapt private-market strategies for defined contribution plans, which traditionally rely heavily on publicly traded securities and daily-valued investment vehicles.
“A key challenge for defined contribution plans is ensuring sponsors have the right wrapper, structure and terms to integrate diversifying exposures like private credit,” Christy Loop, head of U.S. wealth and strategic initiatives at WTW, stated.
WTW has incorporated private markets into defined contribution investment solutions since 2018. Under the expanded arrangement, the firm will retain responsibility for investment research and portfolio implementation while SEI provides the trust and platform infrastructure needed to operate the investment vehicles.
Collective investment trusts are pooled investment vehicles maintained by banks or trust companies and commonly used within employer-sponsored retirement plans. SEI Trust Company has served as an independent CIT trustee for more than 30 years, according to the company.
The firms are targeting plan sponsors, consultants and investment managers evaluating how private assets can be incorporated into retirement portfolios while addressing liquidity, oversight and operational requirements.
Sean Lawlor, head of public markets for SEI’s Investment Managers business, described the expansion as part of the increasing convergence between public and private investment markets.
“The ongoing convergence of public and private markets is fueling new opportunities for more diversified investment solutions through flexible, efficient CIT vehicles,” Lawlor stated.
The companies did not disclose financial terms of the expanded relationship or identify specific new products, launch dates or retirement plans expected to adopt the structures.
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