Month: September 2020

Month: September 2020

first_imgAon Hewitt served as adviser to the trustee in the transaction.L&G was appointed after a competitive selection process in June.According to Martin Bird, senior partner and head of risk settlement at Aon Hewitt, notable features of the deals included structuring CPI-linked longevity protection and developing an effective structure appropriate for the sectionalised nature of the Shipbuilding Industries Pension Scheme.Meanwhile, L&G estimates that these transactions have taken the total market volume for pensions insurance derisking in the UK to more than £16bn in 2013.Tom Ground, head of L&G’s bulk annuity and longevity insurance business, said: “Legal & General has now insured over £7.5bn of pension scheme risk in 2013, including the acquisition of Lucida, and secured over 40% of the insurance derisking business written across the market this year.” BAE Systems has agreed separate longevity insurance arrangements for two of its schemes – the Royal Ordnance Pension Scheme and the Shipbuilding Industries Pension Scheme – with Legal & General (L&G).The new arrangements hedge against the longevity risk of around 17,000 of the schemes’ members, covering a total of £1.7bn (€2bn) of liabilities as measured using the schemes’ funding assumptions, or £1.8bn discounted at Libor.The agreement follows the £3.2bn deal (£2.7bn on the plan’s funding assumptions) set up by L&G for the BAE Systems 2000 Pension Plan earlier this year.Nigel Tinsley, group pensions director at BAE Systems, said: “Following the success of the transaction we completed early in 2013, we are again pleased to have reduced the longevity risk exposure within another two of our pension scheme arrangements.”last_img read more


Month: September 2020

first_img“But, for us, it is not a choice between the two extremes. The discount rate should reflect the nature of the pension deal depending on guarantees, sponsor support, etc. The IORP is just executing this underlying deal.”He noted that, for a fully guaranteed pension deal, the risk-free rate could be applied, and for a pure (collective) DC arrangement, the rate could be based on expected returns.“However, most pension deals in Europe are somewhere in between these two models,” he said.If EIOPA forces all IORPs to use the risk-free rate, “it is ignoring the specifics and conditions of a pensions deal and valuing them as though they were fully guaranteed”, Valkenburg said.He said this happened in some countries with the first quantitative impact study (QIS), where a risk-free rate was applied.“The results exaggerated the funding deficits in some IORPs, but the truth is somewhere between national valuations and EIOPA’s approach,” Valkenburg said.He stressed the importance of getting a “true picture” of a pension arrangement’s liabilities and for plan members, as well as other stakeholders, to understand the implications of conditions attached to the deal.“Both DB and DC risks are currently often not fully understood and not communicated to members sufficiently,” he said.As an example, Valkenburg cites the UK, where pensions are guaranteed, but, in the event of insolvency of the sponsor, they are transferred to the Pension Protection Fund and cut by 10%.“Do members really know about this risk?” he asked.“We are not saying that any kind of deal is good or bad – we just need to get clarity for everyone involved so they have the basis to take action if necessary.”This “taking action” could even be in the form of lawsuits for breach of promise, like some are currently doing in the Netherlands with insurance companies over payments, Valkenburg said.But he stressed that “this is where pensions are different from insurance deals, as the first are an agreement between social partners” and can also be settled within that framework.“This is not only about this generation but also about the next ones, and we are talking about billions of euros worth in promises, most of which still have to be earned,” he said. “And if a slight increase in the retirement age can cause social unrest in France, then this could be worse.“We call for a process starting with clarity, leading to comprehension and from there to conciliation rather than going to court.”To achieve clarity on valuations, the AAE is proposing parameters be set on a national or European basis for ALM studies on liabilities by an independent committee “to prevent biased or too optimistic parameters being applied”.Valkenburg said: “An ALM allows you to make projections into the future development of members and assets of a fund. The HBS approach only shows you the situation at a certain point in time missing the wider point of how a fund can develop in the future.”In an earlier statement on EIOPA’s new IORP stress tests and quantitative assessment, the actuary said that, while HBS was “interesting”, it was “not ready to be used”.“When we take a longer view on pension deals – for example, with an ALM based on reasonable parameters – we will see that most pension deals are not sufficiently financed,” Valkenburg said. However, he pointed out that stakeholders are “not too keen on full disclosure”, adding that “the pain will not go away by just waiting”.And while he thinks the problems are “relatively easy to fix for new accruals”, once clarity has been established, “we still have to deal with promises already made”.On a more technical note, Valkenburg argued that clarity on liabilities also meant no distorting parameters such as the application of a counter-cyclical or matching premium, used under Solvency II, to pension fund valuations.“Let’s not hide reality by using these premiums but rather have the ‘right’ value, an objective value – and if there is a large underfunding, the social partners could then decide to use something like a counter-cyclical premium to define parameters for when to start taking action,” he said. Informing pension fund members about the true value of liabilities is the key to avoiding social unrest in future, according to the Actuarial Association of Europe (AAE).As part of the ongoing debate over which parameters to apply to calculate European IORPs’ solvency levels, the actuaries have compiled a discussion paper calling on regulator EIOPA to push for ‘Clarity before Solvency’.One major demand is for EIOPA to rule out the application of a single discount rate for all IORPs.Falco Valkenburg, chair of the AAE’s pensions committee, told IPE: “The discount rate is very important in EIOPA’s discussions on the holistic balance sheet (HBS), and two types of discount rates are debated – a risk-free rate or a rate based on the expected return on assets.last_img read more


Month: September 2020

first_imgPGB, the €21.4bn pension fund for the Dutch printing industry, has replaced its consumer index-based indexation for a cost-of-living allowance drawn from a fixed 2% inflation. In a letter to its 118,000 participants, it explained that the change would enable it to grant indexation that exceeds real inflation.The pension fund said the new financial assessment framework (nFTK), which contains stricter rules for inflation compensation, had spurred the moveMaarten Jansen, board member at PGB, said: “Under the nFTK, a sustainable indexation is only possible if a scheme’s funding is more than 110%. “However, the amount of indexation could be no more than 10% of the surplus funding. This means the maximum cost-of-living allowance is 1% if the coverage ratio is 120%.”According to Jansen, PGB would have granted less inflation compensation had it continued with the consumer index. “If the consumer index rose 1%, PGB could increase pensions rights by no more than 0.5% in case of a funding of 120%,” he said.“However, with the indexation linked to a fixed 2% index, pensions can be increased by 1%.”PGB said it expected inflation to stay well under 2% for the coming years as a consequence of the European Central Bank’s quantitative easing programme.If inflation increases, the scheme could abandon the fixed indexation target.“The link isn’t fixed forever,” Jansen said, “but it is not our plan to establish a new target every couple of years either.”With its new indexation policy, the pension fund could compensate for the indexation in arrears over the past years.“If this were the case, we won’t count it as a compensating indexation,” Jansen said.PGB, rather than grant pension rights for indexation in arrears, has introduced the principle of an additional inflation compensation of 1%, which could be granted in case of a funding of 130%.That said, at April-end, PGB’s official policy coverage ratio – the nFTK’s criterion for indexation and rights cuts – stood at 104.4%.last_img read more


Month: September 2020

first_imgThe ZAO NPF Raiffeisen has more than €550m in assets under management, as of the end of June.Established in 2004, its asset base has “more than quadrupled” in rouble terms over the last three years.According to Russian financial blog moneyinf.com.ru, ZAO NPF Raiffeisen is the last pension fund in the Russian market managed by a foreign provider, as others run by ING and Allianz were sold in recent years.The authors speculate that the continually changing regulatory landscape in Russia been a contributing factor in their departure.The BIN group now has five pension funds under management, including European Pension Fund, Trust, Education and Science and IET, with combined total assets of more than RUB100bn (€2bn), according to the blog.These will now be combined under a single platform, as reported by IPE.  Over the first half year, Russian pension funds reported a 10% return on average. Austrian banking group Raiffeisen has finalised a deal with Russia’s BIN Group to sell its pension fund business.The move comes as Raiffeisen Bank International’s subsidiary AO Raiffeisenbank aims to concentrate on its core banking business.Sergey Monin, chairman of the board at the Russian Raiffeisen subsidiary, noted in a statement that the Russian pension fund market was currently in a phase of consolidation, where larger players were growing stronger.One of those is the BIN group, which already comprises several pension funds and will grow its member base by another 200,000 with the current purchase.last_img read more


Month: September 2020

first_imgHe is set to leave MN in July with the group’s three other board members taking on his responsibilities until a permanent successor is appointed. UK Treasury – UK prime minister Theresa May has asked Elizabeth Corley, vice-chair of Allianz Global Investors, to lead an industry taskforce on impact investment. The taskforce is to take forward the recommendations in a report published by an advisory group that was chaired by Corley. The prime minister has asked the taskforce to provide a progress report to Matt Hancock, Secretary of State for Culture, and John Glen, economic secretary to the Treasury, by the summer. The government is also expected to announce its policy response in the summer.Fidelity International – The international investment giant has appointed Christian Staub as managing director of its continental European business. He takes over from Jon Skillman who is moving to a new role in Fidelity’s Global Workplace Investing group. Staub joins from BlackRock where he worked for four years, most recently as head of institutional client business for continental Europe and country head for Switzerland. He has also worked at Allianz and PIMCO. He takes over the Principal Global Investors (PGI) – Frank Richter has been joined the firm to lead its German and Austrian operations. Principal has been operational in Germany since 2003 but said this was the first time it had focused on serving the Austrian market as well. Richter joins Principal from Standard Life Investments, where he served as country head and head of institutional business for Germany and Austria. Prior to this, he was head of institutional business for Germany and Austria for AXA Investment Managers.Payden & Rygel – The institutional fixed income manager has opened an office in Milan, its first in continental Europe. Nicolo Piotti, who joined the firm in September from Morgan Stanley, has been named managing director, with responsibility for running the Los Angeles-headquartered firm’s Italian operation. BNY Mellon – Katherine Starks has been appointed head of the group’s asset servicing business in Germany, Austria, Switzerland and central and eastern Europe. Starks was formerly head of continental Europe for sales, relationship and account management for the Euroclear group.Aon – Bill Gourlay has been hired as global head of investment product development, a newly created role. He will be responsible for leading the firm’s work in assessing the viability of new investment solutions, as well as developing and launching them and monitoring their progress when in use by clients. Gourlay was previously the chief executive officer of Idea Group, a fintech provider of business process improvement solutions to the pensions and alternative investments sectors. Institutional Limited Partners Association (ILPA) – The global organisation representing private equity investors has named Steven Nelson as its new chief executive officer, effective from 26 March. Nelson joins from consultancy group Cambridge Associates where he was chief operating officer. ILPA is currently working with the UK’s local government pension schemes and the Industry Disclosure Working Group to aid the creation of a cost disclosure template for the UK market.Vigeo Eiris – Arnaud de Batz is the ESG research provider’s new chief executive officer as of this week. He was most recently responsible for asset management consulting services at Accenture. Before that he was managing director at LeverEDGE Partners, with other former workplaces including Dexia Asset Management and Fitch Ratings, where he was global head of rating operations in asset management. Vigeo Eiris president Nicole Notat said: “Arnaud arrives at the right moment. The role of extra-financial ratings is confirmed by both issuers and investors.”HSBC Securities Services – Riccardo Millich has been named sales director at HSBC Securities Services in Luxembourg, a newly created role. He will be responsible for the firm’s local sales strategy and supporting its business growth with all countries and asset classes in scope of UCITS and AIFMD. Paul Heffernan, head of cross border sales, said the group saw strong opportunities for growth in Luxembourg. Neuberger Berman – Alan Isenberg has joined to lead the investment manager’s global product strategy and marketing work. He joins from PIMCO where he was most recently head of strategy and business management for Asia Pacific. MN, Allianz, Fidelity, Principal Global Investors, Payden & Rygel, BNY Mellon, Aon, ILPA, Vigeo Eiris, HSBC, Neuberger BermanMN – The pension manager’s CEO René van de Kieft has left his role. In a statement he said wanted to invest more time in other ambitions, such as sustainability, and helping people in economically disadvantaged positions. MN’s chair Ella Vogelaar said the decision came as a surprise to the company’s board, but said it respected his decision.“I see my own mission as broader than what is possible as chairman of a pension provider,” Van de Kieft said. “It is an inner drive that I want to focus on with energy and conviction.”Van de Kieft joined MN in May 2015, succeeding Ruud Hagendijk. He previously held a number of senior pensions roles including chief financial officer at PGGM and a board member at ABP. Under his stewardship MN sold its UK business and refocused on its Dutch clients, primarily the metal industry schemes PMT and PME as well as the merchant navy scheme Koopvaardij.last_img read more


Month: September 2020

first_imgThe pilot study aims to integrate quantified risks linked to climate change into standard forward-looking financial scenario sets that are behind strategic investment decision-making, the participants said.Investors involved in the work will use these data sets to analyse the effects of various possible global warming sequences on their asset liability management/strategic asset allocation.The pilot is expected to run until the end of 2018, and if successful, the “climate-savvy scenario set” is expected to be made more widely available to investors by early 2019, the participants said in their joint statement.Other firms taking part in the project include Cambridge Econometrics and Carbon Delta, while various research organisations and universities are also involved. Earlier this year Ortec Finance announced it had created a “strategic climate solutions” team.Meanwhile, Danish labour-market pension fund Sampension announced it has decided to adopt the Task Force on Climate-related Financial Disclosures (TCFD) guidelines, becoming the fifth Danish pension fund to do so.Hasse Jørgensen, Sampension’s chief executive, said: “We will use a measuring tool used by TCFD to calculate the carbon footprint (…) of our investment portfolios.”Knowledge and specific measurement methods for how the climate affected companies – and therefore the basis for Sampension’s investments – were a very useful way forward, he said, giving a better opportunity to determine and price financially-material risks related to climate impact. Several European pension funds, including Sweden’s AP1, are launching a project on climate change risks they say could help inform portfolio decisions in the future.Dutch pension funds PME, the €46.7bn metals scheme, and Philips Pensioenfonds, are also involved. Alongside Dutch insurer ASR, Canadian pensions manager OPTrust and financial technology firm Ortec Finance, the three pension funds – which have nearly €100bn in assets between them – described the work as a “cutting-edge research project to integrate climate change into strategic investment decisions”.Mikael Angberg, CIO at AP1, said: “Better knowledge of how climate change might affect risk and returns is crucial for our long term performance. “Participating in this climate study will not only deepen our understanding but also be an important input in articulating our climate strategy.”last_img read more


Month: September 2020

first_imgDenmark’s biggest pension fund ATP reported a 5.8% return on its geared investment portfolio for the first nine months of this year, with private equity the main contributor.In its report on the first three quarters of 2018, the statutory pension fund said overall assets, including those earmarked both for guaranteed pensions – ATP’s giant hedging portfolio – and its bonus potential, grew to DKK779bn (€104bn) from DKK769bn over the period.Christian Hyldahl, ATP’s chief executive, said: “Our balanced investment portfolio has generated a stable return in a difficult period, and we are pleased with the contribution from the illiquid part of our portfolio.”The return had mainly been driven by private equity, real estate, infrastructure and listed Danish equities, he said, whereas investments in US government bonds had contributed negatively to the return. “We continue to take risks based on a disciplined approach to both portfolio construction and risk management as a way of ensuring that we create satisfactory long-term results despite the low and uncertain return environment,” Hyldahl said. Christian Hyldahl, CEO, ATPIn the previous five years ATP had achieved average investment portfolio returns of 3.8% per quarter, he said.ATP’s unlisted equity investments contributed DKK2.9bn to the total DKK6.9bn return registered in the January-to-September period. Real estate, infrastructure and listed Danish equities each contributed more than DKK1bn to the overall result.Government and mortgage bonds were the main detractor from returns, losing DKK1.9bn, according to the interim data.The figures implied a relatively large loss on government and mortgage bonds between July and September, since the reported loss for the asset class at the end of June was just DKK157m.The 5.8% return for January to September was the profit ATP made on its bonus potential – the investment portfolio – which was worth DKK102bn at the end of September.The investment portfolio is currently three times leveraged through borrowing at market rates from its hedging portfolio, so the published return figure is not comparable to overall investment returns posted by other Danish pension funds.last_img read more


Month: September 2020

first_imgJust one of the bedrooms in this sprawling homeThe other wing is where you will find another two bedrooms, one with its own balcony and the other with its own study. Each one has its own ensuite bathroom.Outside, there is three undercover living areas with panoramic views of the Brisbane River, a fire pit, a private pontoon and a resort-style infinity edge salt water pool. The kitchen overlooks the river, and includes a butler’s pantry, breakfast bar, a wall of European appliances including double oven, gas cooktop and coffee machine, suspended stainless steel rangehood, stone and stainless steel benchtops and feature lighting. There is also close access to the big vegetable garden outside. The outdoor area makes a splashMrs Wyldbore said the house had been a great place to raise a family but it was time to pass it on.One of her fondest memories would be their 25th wedding anniversary, which was celebrated on the terrace with 100 friends and family.“But my husband (a retired Cathay Pacific pilot) wants to spend more time on the golf course now rather than in the garden,” she said.“It is a big family home but it is well-designed and easy to look after. It is just time for someone else to enjoy it now.” A series of water features make it look like water runs through the house and out to the Brisbane River“When you walk in to the foyer you come to the dining room and an internal water feature,” she said.“Then as you keep walking you see an outdoor reflection pool, the infinity pool and then the river.“It looks like the water just runs through the house, all the way to the river.”On the ground floor there is also a statement kitchen, a study, a living room, multi-purpose room, and two bedrooms, each with their own walk-in-robes and ensuites. More from newsParks and wildlife the new lust-haves post coronavirus16 hours agoNoosa’s best beachfront penthouse is about to hit the market16 hours agocenter_img The living spaces are open and airyMrs Wyldbore said their daughter, who is now at university, had grown up using the two downstairs bedrooms, with one used as a playroom, then a music room and finally a study.Upstairs, there is a master bedroom in one wing that includes seperate his and hers walk-in wardrobes, two ensuites and a kitchenette. 111 Lather Rd, BellbowrieTHIS modern mansion on a sprawling 18,000sq m block overlooking the Brisbane River has been described as a ‘rare find’.And when the original owners decided to move overseas in 2007, neighbours Sheila and Ronald Wyldbore jumped at the chance to buy the magnificent flood-free riverfront acreage property.But the couple are downsizing to a smaller property at Hamilton.“It has been our well-kept secret for 11 years,” Mrs Wyldbore, a retired Hong Kong businesswoman, said.“We were living down the road and bought it off the original owners who built it.“It is just a magnificent house and property and had everything we needed as a family.”The house has five bedrooms, six bathrooms, and space for five vehicles. Mrs Wyldbore said one her favourite features was the water features.last_img read more


Month: September 2020

first_imgThere is privacy and space in the master bedroom on the second storey. More from newsCrowd expected as mega estate goes under the hammer7 Aug 2020Hard work, resourcefulness and $17k bring old Ipswich home back to life20 Apr 2020 The house suited because it was ready to move in, with no major renovations necessary.“To sell a property in a day doesn’t happen very often, not unless there is competition.” Ms Smith has confidence in the current market and is encouraging potential sellers to list now. “The market is going well,” she said.“We’ve had four settlements so far and another three coming. We just need listings at the moment.”The latest CoreLogic property data shows Underwood’s median house price is $552,100, a 0.4 per cent rise in 12 months, with 83 houses sold in the last 12 months. An offer was made on this house last year but the start of school brought fresh interest and it has now sold for $530,000.A HOUSE that had been on the market since November was bought in a day by a family moving closer to school.The four-bedroom two-storey house at 9 Glencoe Court, Underwood, is on a 551sq m block with an upstairs master suite. An early offer last year was not negotiable, so the owner decided to wait until after Christmas.The house sold during the first week of school for $530,000 with @Reality agent Leanne Smith saying the buyers were keen to move into the area as they already had children at a nearby school. SEE WHAT ELSE IS FOR SALE IN UNDERWOODcenter_img “They really liked it straight away, the floorplan worked for them and it was in a cul-de-sac,” she said. >>>FOLLOW THE COURIER-MAIL REAL ESTATE TEAM ON FACEBOOK<<<last_img read more


Month: September 2020

first_imgGambian ops An independent oil and gas advisory firm, RISC Operations, has conducted an audit of Far’s internal estimate of Prospective Resources for the Samo and Bambo prospects located in The Gambia permits A2 and A5. The Bambo prospect has been identified following recent mapping of the 3D seismic and targets a separate reservoir objective on the same structural trend as the Samo prospect. The two prospects have a combined best estimate Prospective Resource of 1.1 billion barrels on a gross unrisked basis (926 million barrels net to Far).The Samo prospect has two target intervals, is on trend and shares many similarities with the giant SNE oil field. As such it is very highly rated with an estimated chance of success (CoS) in one or both targets, endorsed by RISC, of 55%. According to Far, it is rare to have an exploration prospect with such a high CoS but this reflects the adjacent discovery at SNE and the confidence Far Limited has developed in exploring in the play fairway which is yet to experience a dry well. The Bambo play type is less understood but the Bambo prospect is still highly regarded with a CoS of 18%. Far said that more work will be carried out to improve understanding of the play and to further derisk the prospect.Far has also mapped a number of large leads in Block A5. This is in an area of poorer data quality and extends outside the 3D seismic coverage. These leads will be the subject of further mapping when the reprocessing of the seismic survey is available.Far Managing Director, Cath Norman, said: “Since making the discoveries at SNE and FAN offshore Senegal, and subsequently at FAN South and SNE North, it has been Far’s core strategy to build on our geological knowledge, contacts and nimbleness in the market to add high quality drilling opportunities in the MSGB Basin for our shareholders. As the RISC audit testifies, the opportunity we have captured in Blocks A2 and A5 offshore The Gambia represent a huge prize if successful.“Given the eight successful wells drilled on the shelf to date in Senegal and into the key reservoirs in the Samo prospect, the geological chance of success for drilling this prospect is high for a frontier exploration well. The Samo well will be the only exploration well to be drilled offshore The Gambia since the Jammah-1 well drilled in 1979.“Success in this well at the scale that RISC has supported would be truly transformational for the people of The Gambia and Far is proud to again be in the privileged position of delivering the country’s first, modern exploration well as we were in 2014 in Senegal.” Potential for 1.1 billion barrels of oil Following Government approval of the assignment of Far’s 80% interest in Blocks A2 and A5, Far as the operator of the Block A2 and A5 joint venture has progressed the license work program including well planning activities.Far’s Gambia office was opened in September 2017 and its in country team of 5 personnel is focused on managing Government and in country stakeholder interfaces and relationships. Well planning and preparation activities are progressing with; long lead items ordered, well design planning underway and preparation of an enviromental impact assessment and contingency plan started. Rig and shore base options are being investigated.Geotechnical studies are progressing including reprocessing of the Block A2 and A5 3D seismic data by Petroleum Geo-Services (PGS) with the aim of improving the data quality for optimizing the location and design of the anticipated Samo exploration well. Two Far Limited-operated prospects located in Blocks A2 and A5 offshore The Gambia have a combined best estimate prospective resource of 1.1 billion barrels of oil.Earlier this year, Far took over 80% interest in offshore Blocks A2 and A5 from Erin Energy while Erin kept the remaining 20% interest. The transaction was approved by the country’s government in July giving Far operatorship over the two blocks.Far has completed detailed geotechnical studies and assessed significant hydrocarbon resource potential in its two blocks offshore The Gambia, the Australian company said on Tuesday.The Blocks A2 and A5 permit area, covering 2,682km2, are adjacent to and on trend with Far’s world class SNE oil field discovery and have significant exploration potential. A2 and A5 sit within the rapidly emerging and prolific Mauritania-SenegalGuinea-Bissau (MSGB) Basin and lie approximately 30km offshore in water depths ranging from 50 to 1,500 meters.From 1,504km2 of modern 3D seismic data acquired in A2 and A5, Far said it has identified large prospects similar to the “shelf edge” plays Far has successfully drilled in Senegal. FAR has mapped two drillable prospects, Samo and Bambo and additional leads in the blocks.last_img read more