Wednesday people roundup

first_imgSociété Générale Securities Services – Jason Nabi has been appointedto the newly created position of head of financial institutions and brokers (FIB) for the UK. Reporting to Guillaume Heraud, global head of business development for financial institutions and brokers, he will be responsible for leading the business development strategy for FIB and its position across this client segment in the UK. He was previously responsible for the strategic business development of Markit’s asset servicing business.Allenbridge – Odi Lahav, chief executive, is totake over the company’s management from Karen Shackleton, currently managing director. Shackleton will, however, continue to handle her own client portfolio.Conning Asset Management – Ben Hamilton has been appointed portfolio manager in London. Hamilton, who will report to Russell Büsst, CAM’s European CIO, will assist senior portfolio managers managing fixed income portfolios for the European client base, and developing CAM’s global bond offering. Hamilton joins from Premier Asset Management, where he was assistant investment manager and research analyst for fixed income and multi-asset funds.GLG Partners – Simon Price has been appointed to the financials team. He will assume the position of asset manager, contributing to global, European and financials long/short strategies and working alongside the existing financials team of David Sanders and Stephen Holliday, with particular focus on stock-picking opportunities in the US and Japanese financials sectors. He joins from Occitan, where he was partner and global sector head for financials and macro analysis. Loyalis, State Street Global Advisors, Institutional Investors Group on Climate Change, Société Générale Securities Services, Allenbridge, Conning Asset Management, GLG Partners Loyalis – Aad van der Klugt is to leave as a board member at Loyalis, the APG subsidiary for additional pension products. His departure follows the slimming down of the company, as a result of a changing life insurance market, as well as the transfer to APG of the Loyalis subsidiary for tailor-made administration (LMA). Van der Klugt’s responsibilities will be assumed by Peter van Wageningen, chairman of the board, and financial director Wim Vliex. State Street Global Advisors – Mark Fortier has been appointed managing director, head of global defined contribution research and product development. Fortier, most recently head of product and partner strategy at Alliance Bernstein, will be responsible for developing products that anticipate plan sponsor needs, working closely with the investment teams across SSGA to bring new DC products to market globally. He will be based in Boston, reporting to Fredrik Axsater, managing director and global head of defined contribution at SSGA.Institutional Investors Group on Climate Change – Peter Damgaard Jensen has been appointed to the board of the IIGCC. Jensen is managing director and chief executive at PKA, and was also chairman of the Danish Insurance Association from 2009 to 2013.last_img read more

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PFA Pension to invest up to DKK20bn in Danish companies

first_imgDenmark’s biggest commercial pension fund PFA said it plans to invest between DKK15bn (€2bn) and DKK20bn in Danish businesses over the next five years, preferring to remain a minority shareholder in the companies.In an interview with Danish financial daily Børsen, Henrik Heideby, group head and chief executive at PFA, said: “We will increase investments by up to 10% of our total holdings in the next five years. This corresponds to DKK30bn to DKK40bn. Half of that will be in Danish businesses.”PFA will invest broadly across sectors to spread its risk, he said.“We don’t want to be the main owner of companies,” he added. “Experience shows that businesses that are owned by pension funds alone do badly.”However, PFA could invest alongside a capital fund, he said, adding that many companies would like to have PFA as an investor, as it is seen as an endorsement.“We get a lot of inquiries,” he said.PFA is particularly interested in investing in larger companies, Heideby said. But since there is not such a huge range of big companies in Denmark, it is also possible PFA will gather a group of investments and invest jointly, he said.“There are many thoughts and possibilities about this,” he said.last_img read more

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IORP II: Not bad but could do better

first_imgPredictably, the UK’s pension minister Steve Webb heaped praise on the new British policy of allowing lump-sum beneficiaries off the hook of having to put it into an annuity. The British citizen’s innate sense of wisdom could be trusted not to blow any windfall on whatever, was the implied boast. Webb then urged against EU cross-border “excessive harmonisation”. After a slight hesitation, he softened this with approving nations “learning from each other”.But Webb came up, unsurprisingly, with the best anti-EU barb. As for the European Insurance and Occupational Pensions Authority, he said: “No-one in the UK has ever even heard of it. [But] it’s creeping in.”Not dissimilarly, “we can’t have legislation coming in through the back door” came from the boss of BusinessEurope, Markus Beyrer. He made it clear that pension funding has no “need for any extra capital”. That is a sentiment expressed at virtually every conference on the subject of pensions. Its repetition would make a parrot swell with pride. And, sadly, it ignores the key challenges of increased longevity, low fertility and the prospect of soup-kitchen lives for future retirees.Also on the top table of the relevant panel, but generally ignored, was someone from the Commission itself. Nadia Calvino, a deputy director general, listened, once lightly scratched her face, but mostly she sat still. However, when something was said she clearly found to be particularly obstructive, her eyes turned up to the heaven. Ah! A Latin gesture!At last her turn did come. “To think we can solve all our problems by working at national level,” she said, “is, I think, not very credible.”As for the attacks on back-door legalisation, her answer was: “I have never seen the European Commission proposing anything out of the blue!” No doubt, she will have devoted many hours of her life to the Brussels activity of ‘committology’ – endless meetings for ‘stakeholders’ to have their say. Jeremy Woolfe on the latest skirmish between Brussels and EU member states on the thorny issue of pensionsThe European Commission’s conference in Brussels last week on the future of pensions was billed as a stocktaking exercise of reform developments over the past two years. It also had the objective of looking ahead.On stocktaking, the consensus turned out as ‘not too bad, but could do better’. Twenty-three countries have managed to raise their official pensions age, and seven have linked it to longevity, commissioner László Andor was pleased to report. But equal treatment for the female gender remains one of the vital issues he noted. New thoughts? Yes, indeed!Commissioner Michel Barnier emphasised that the subject of cross-border pensions needed a good looking into, and this was something that came up more fully the following day, at the presentation of IORP II Directive. Joanne Segars, chair at PensionsEurope, who wants to see “less red tape coming out of Europe”, called for efforts to centre on tackling the fact that half of European workers have no occupational pensions lined up.last_img read more

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DC audit to investigate all schemes above auto-enrolment charge cap

first_imgAn independent audit of workplace defined contribution (DC) insurance products is set to examine the appropriateness of charging structures that are above a cap set by the UK government.It was originally expected to audit only workplace DC products set up before 2001, after an investigation from the Office of Fair Trading (OFT), a former competition watchdog, highlighted fees in these schemes as a concern.However, the committee said it had decided to use the charge cap as a baseline and audit all schemes above this limit, alongside those in its initial remit.This is despite the government’s charge cap only covering auto-enrolment default schemes and not any of schemes within the audit’s initial remit. “We have considered the implications of the charge cap proposed by the Department for Work & Pensions (DWP) for the scope of the audit,” the committee said.“We have decided to include in the audit those schemes with charges above the cap. These are schemes that only have an annual member charge (AMC), and all member borne charges are between 0.75% and 1%.”The new scope will now audit all DC workplace schemes set up before 5 April 2001 and schemes set up after this where member-borne charges, excluding transaction costs, exceed 1%.It will also audit schemes that use combination charges, or more than one basic charge, regardless of when these schemes were set up.Pensions minister Steve Webb introduced a 0.75% cap on charges for all default funds used for auto-enrolment to come into effect next April.This includes schemes using all-inclusive fees, but excludes transaction costs while the government consults on the most appropriate method to include this.However, while the cap only tackled high-charges for auto-enrolment schemes, a study from the OFT, published last year, found a legacy of high charges and poor returns within insurance products set up before 2001.As a result, the OFT recommended these legacy schemes be audited as a better option to imposing a charge cap – which would affect some products such as guaranteed annuities.The OFT did not propose any charge caps, warning of unintended consequences.However, the government went against its advice is response to auto-enrolment funds.Carol Sergeant, who chairs the board responsible for the audit, said the final report would be published at the end of 2014.“It will set out the charging structures of in-scope workplace pension schemes, as well as show the impact of these charging structures on different types of scheme members,” she said.“It will also include any IPB recommendations for industry-level actions.”Steve Webb added: “The OFT identified £30bn of savers’ money in pension schemes with charges at risk of being poor value for money.“It is right the audit looks closely at these arrangements.“It is important all schemes give savers the confidence they are acting in their best interest.”last_img read more

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Experts calls for cut in key discount rate for Swiss pension funds

first_imgThe association of Swiss pension actuaries has recommended that Switzerland maintain the so-called technischer Zins – the discount rate used by Pensionskassen – at 3%. However, many Swiss pension funds have already cut their rates, or are preparing to cut them from next year – such as the CHF36bn (€29.4bn) scheme Publica, which announced a cut to 2.75% some time in 2015.According to Swiss consultancy Complementa, three out of four Pensionskassen have already applied a rate of 3% or less, with some, such as the Migros Pensionskasse (MPK), adopting a rate as low as 2.5%.Swiss consultancy ppcmetrics said it expected the government’s expert panel to “hone in” on the 2.5% level in the coming years. For its calculations, the actuary association considered the average performance of a benchmark portfolio over a given period, moving this along each year.This means higher performances reported in the mid-1990s were dropped, leading to a lower average.One-third of the calculations was based on Swiss government bonds, which are now trending downward.Ppcmetrics said it expected the association to recommend a cut in the discount rate to 2.75% at the end of 2015 and another cut to 2.5% two years’ later.With a lower discount rate, pension funds might also have to adjust their future promises on conversion rates, known as Umwandlungssatz.However, without the changes planned as part of the Altersvorsorge 2020 reform package, some smaller funds that only manage mandatory assets might not have the chance to go below the legal minimum conversion rate, which is currently 6.8%.last_img read more

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Dutch government rejects ring-fencing amendment for APF Bill

first_imgJetta Klijnsma, state secretary at the Dutch Ministry of Social Affairs, has scrapped a proposal in the Bill for the ‘general pension fund’ (APF) that would have allowed industry-wide pension funds to merge while ring-fencing their assets.Her decision follows the recommendation of the Council of State (RvS), the highest legal adviser for the government. Klijnsma will now present a revised Bill before the Lower House.The initial proposal is to be debated in the Senate. The ring-fencing proposal had been added to the APF Bill after MPs Helma Lodders of the liberal party (VVD) and Roos Vermeij of the labour party (PvdA) tabled an amendment, which the Lower House adopted by unanimous decision.At the time, however, Klijnsma warned that the added clause could undermine the principle of mandatory participation, and therefore called on the RvS for advice. The RvS concluded that the ring-fencing of assets at mandatory industry-wide schemes would distort the market, improving a merged scheme’s competitive position relative to other pension providers, such as insurers.It also claimed the amendment was “incomplete”, as it failed to clarify exactly how ring-fencing would maintain the distinction between the existing multi-company scheme and the proposed APF, which is meant to replace the multi-scheme.The Dutch Pensions Federation, responding to Klijnsma’s decision, warned against further delays in the APF’s introduction, now scheduled for 1 January 2016.It said it also disagreed with the RvS’s conclusion that the amendment would have distorted the market.last_img read more

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Greenwich tenders 40% of portfolio as it seeks new equity manager

first_imgGreenwich’s local authority fund pension fund is tendering 40% of its portfolio as it looks to hire a new equity manager.The Royal Borough of Greenwich said it was tendering an equity portfolio worth £400m (€565m) and that it hoped to hire a single manager to oversee a passive equity mandate split across UK shares and global market-cap weighted indices.It said it would prefer to invest in an existing pooled fund solution, using a fundamentally weighted global equity index, such as the FTSE Research Affiliates 3000 index.Those interested in the equity mandate have until 16 December to register their interest with the council’s procurement department. The £400m tender comes shortly after the £1bn fund tendered a £100m diversified alternatives mandate.The local authority fund earlier this year decided on an amended strategic asset allocation, which will see it increase its equity exposure slightly to 50% of assets.It currently employs State Street and BlackRock as its global equity managers.State Street was only appointed in August 2013, after a mandate by another asset manager was terminated.last_img read more

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MN sets sights on manufacturing sector to increase scale

first_imgMN, the €114bn asset manager, is looking to increase its scale by winning over pension funds from the Dutch manufacturing sector as clients.According to its 2015 annual report, it aiming to offer in particular its expertise in fiduciary and asset management.In addition to the €40bn PME and €60bn PMT pension funds, MN also services the €4bn pension fund for the merchant navy (Koopvaardij), as well as seven smaller schemes, including those for Unisys, Cargill, Forbo and Wheels & Tyres.MN, based in The Hague, said it expected to close its Amsterdam office, where it employs approximately 120 staff, this year as part of its drive to reduce costs. Last year, it sold its UK operations to Kempen Capital Management, citing its desire “to refocus on the Dutch market and Dutch clients”.The asset manager reported an operational loss of almost €14m, pointing to the switchover to a new IT system for the administration of income insurance for employers and employees as the main cause.It said it expected to be back in profit this year.In 2014, MN embarked on a four-year process to automate administrative systems and processes almost fully, to achieve a quicker turnover and reduce error margins, while also cutting costs.Last year, it also launched a programme for culture change by improving all processes and departments, focusing on client and their participants.This lead to a reduction of staff in 2016, according the provider, which earlier announced that approximately 220 jobs in its 1,200 strong staff were to disappear.In 2015, MN reduced the executive board from eight to four seats in its drive to improve efficiency.It said it had also developed a climate strategy aimed at the transition from fossil fuels to sustainable energy.MN said the largest challenge for pension funds in the manufacturing industry would be to regain their participants’ trust.René van de Kieft, who succeeded Ruud Hagendijk as chief executive last year, said: “We must jointly explain the strength and the value of our pensions system, as well as our contribution to proper pensions management.”last_img read more

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UK regulator sets out climate change investment guidance for DC schemes

first_imgThe UK’s Pensions Regulator (TPR) has issued updated guidance for defined contribution (DC) investments that includes an obligation on trustees to consider climate change when producing their investment strategy.The new DC investment guidance incorporates regulations that are due to come into effect in October 2019 and October 2020, and has been published in response to industry requests for further guidance in certain areas.According to David Fairs, executive director of regulatory policy, analysis and advice at TPR, climate change is a “core financial risk which trustees will need to consider when setting out their investment strategy”.“They will be obliged to show how they are taking this and other financially material considerations into account over the lifespan of investments,” he added. TPR’s guidance stated: “Consideration of ESG factors allows you to evaluate the short and long-term financial risks and opportunities of your investments by looking at the current practices of the firms in which you invest.”It added that it was important for trustees to understand “the implications of the systemic risk of climate change on investment decisions in the context of your scheme when developing your SIP [statement of investment principles]”.Guy Opperman, minister for pensions and financial inclusion, said pension schemes had a significant part to play in tackling the climate emergency.Vassos Vassou, a professional trustee at Dalriada Trustees, added: “With climate issues becoming front of mind, we need to be conscious of what our members want from their investments and act responsibly on their behalf.”From October this year, trustees must make their SIP available free of charge on a website.Then from October 2020, trustees will have to produce an implementation report that explains how they have followed and acted on the investment policies outlined in the SIP, such as environmental, social and governance factors, and stewardship of investments.Daily dealing and liquidityTPR’s new guidance also addressed asset liquidity and dealing frequency, stating that it “may not be beneficial for dealing to be carried out daily”.In the updated guidance, TPR said trustees should think about the level of liquidity that members need, and take into consideration “the liquidity constraints on certain fund structures”.Earlier this month, financial services regulator the Financial Conduct Authority revealed it was reviewing its rules about open-ended funds holding illiquid assets after Woodford Investment Management had to halt redemptions from its LF Woodford Equity Income fund, which had a significant allocation to illiquid companies.last_img read more

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Asset management roundup: Nuveen, Churchill create $21bn private capital platform

first_imgNuveen, the investment manager of US pension fund TIAA, is folding its private equity and junior capital group into Churchill Asset Management, its middle-market senior loan and unitranche financing business, to create a direct access platform with more than $21bn (€18.9bn) in committed capital.The combined platform will operate as Churchill.Ken Kencel, president and chief executive officer of Churchill, said the combination of the two businesses “creates one of the largest, most differentiated middle market private capital investment platforms” in the US.The combined platform manages more than 250 portfolio investments and has more than 150 limited partner investments in middle market private equity funds. Collectively, the combined businesses invest more than $5bn annually in over 100 middle market companies, led by highly experienced investment teams. The new platform will provide customised financing solutions across the capital structure including first lien, unitranche, second lien and mezzanine debt and equity co-investments, in addition to private equity fund investments.DWS takes AI stake via ArabesqueDWS Group has acquired a minority stake of 24.9% in Arabesque AI, asset manager Arabesque’s artificial intelligence company. The companies also agreed on a strategic partnership to enhance the capabilities of the AI engine, and to develop sophisticated AI-based investment solutions. Both parties have agreed to establish an expert working group for ongoing collaboration.They said that as part of the cooperation they intend to work exclusively on new projects together.Asoka Woehrmann, CEO of DWS, said: “The strategic partnership with Arabesque AI is the next step towards the digitalisation of DWS. It will clearly strengthen our digital capabilities and, in particular, our artificial intelligence know-how.”“[I]n the future, the AI engine will deliver innovative signals that will help us identify additional alpha sources, and will enable us to make smarter decisions,” he said.The firms said they had agreed to maintain confidentiality on the price of the transaction and further financial details. The transaction has already closed. Last year DWS took in a minority stake in Arabesque S-Ray GmbH, an ESG data provider, and entered into a strategic partnership for the development of new ESG data products and services.“With this suite of investments, DWS is following through in strengthening its ESG and digital capabilities, as announced at last year’s annual general meeting,” the German asset manager said.last_img read more

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