Zurich calls on Swiss pensions regulator for minimum risk standards

Posted On Sep 29 2020 by

first_img“It is the OAK’s responsibility to harmonise the supervisory parameters in Switzerland,” he said.In its annual report for 2013, Switzerland’s top supervisory authority, the OAK, actually included the “re-calibration of risk parameters” as one of its goal for 2014.Tischhauser said it was “too early” to make any predictions on which parameters would be included but confirmed that a working group consisting of representatives from the OAK, the social ministry BVS, the association of pension fund experts SKPE, the chamber of custodians THK and the Swiss pension fund authority ASIP was discussing the issue.Tischhauser became head of the newly created supervisory authority in Zurich a year ago, when it was set up as an independent body as required under the new law created by the Strukturreform.Since then, he has introduced a ‘risk-tool’ that includes various parameters by which to assess the financial situation of a Pensionskasse.“We have been pioneers in this field – not least because we have a large market share,” he said, adding that benchmarks such as the funding level were “important but not enough”.In total, the BVS is supervising 45% of all Swiss pension funds, which are managing around 35% of the total volume in the second pillar.He also hired pension fund experts for his supervisory authority to “increase the know-how” on risk assessment in Pensionskassen.Tischhauser stressed that pension funds should “not underestimate” reputational risk, as reports on financial problems in the second pillar “might lead to further regulation”.“And we already have enough of that,” he said.On the financial situation of Swiss pension funds, he pointed out that not all schemes had done enought to build their buffers, but he said some had made the most of good returns in recent years.Similarly, he said the technical parameters for calculating liabilities at Pensionskassen had improved, “but we are not yet where we should be”.“With the structural reform, the supervisory authorities have been given a mandate for quality control at Pensionskassen, and we are looking into how pension funds experts have advised funds and whether their recommendations were followed,” he said.For Tischhauser, a next step would be “to set down binding standards” on how to react if pension funds fall short of certain risk parameters. The supervisory authority of the Swiss canton of Zurich (BVS) is lobbying for binding standards in the risk assessment of pension funds, according to BVS director Roger Tischhauser.Tischhauser told delegates at the bi-annual pension fund conference Fachmesse 2. Säule in Zurich that the new supervisory bodies in Switzerland needed such guidelines to properly assess Pensionskassen – and punish them if necessary.“We cannot demand certain standards if they are only recommendations,” he told IPE.However, he added that any further demands on pension funds should not create additional costs in the second pillar.last_img read more

Infineon scheme in Austria outsources asset management to Allianz

Posted On Sep 29 2020 by

first_imgThe semi-conductor company Infineon Technologies Austria has started to outsource its pension fund to Allianz.As of January, the insurance group’s Pensionskasse took over asset management of the company pension fund, according to an Allianz spokesperson.A complete outsourcing is underway, scheduled to be finalised by January 2017, pending approval by the authorities.Infineon declined to comment further or reveal the current size of assets under management in the fund. In its 2015 annual report, the company reported operational capital in the listed Infineon Pensionskasse at €800,000 per year-end 2014.In Austria, Infineon employs more than 3,000 people, just under one-tenth of its global workforce, although it is unclear whether all Austrian employees are covered under the pension fund.In terms of assets, it may therefore not be a massive gain for the Allianz Pensionskasse, one of the smaller Austrian pension fund providers, managing more than €600m and the 2015 winner of the “Best pension fund in Austria” category at the IPE Awards.The news marks the continuation of a trend that has led to the outsourcing of almost all company pension funds in Austria.After the outsourcing of Infineon, the number of company schemes has dropped to just four: car company Porsche, computer giant IBM, Austrian electrical company EVN and the Austrian social insurances.However, some of these have already outsourced their asset management to a multi-employer pension fund while keeping administration in-house – EVN’s assets, for example, are managed by the VBV. The most recent of these outsourcings was the Generali insurance group, which transferred its assets to the Bonus Pensionskasse last year.Also in 2015, Austrian finance minister Hans-Jörg Schelling warned of an oligopoly in the domestic pension fund market following the takeover of the Victoria-Volksbanken Pensionskasse by Bonus.last_img read more

France roundup: ERAFP carbon reporting, UMR office deal, sovereign green bond

Posted On Sep 29 2020 by

first_imgThe €24bn* pension fund said that it has for the first time published a measurement of how the energy mix of its equity portfolio compares with energy mix scenarios advocated by the International Energy Agency (IEA) for 2030 and 2050.It said that at the end of 2015, the proportion of fossil fuels in ERAFP’s portfolio was already aligned with that formulated by the IEA for 2030, but that there were shortfalls in other areas. The proportion of renewable energies, for example, would have to double in order to meet the target level for 2030.It said that “over the coming years, the gradual rebalancing of ERAFP’s portfolio for better alignment with the most favourable climate scenarios can be envisaged through several approaches”.“In the wake of this first assessment,” said the pension fund, “the challenge facing ERAFP over the coming period will be to perfect a carbon-free investment strategy.”French pensions mutual UMR has made its first purchase under a €150m real estate mandate awarded to Swiss Life REIM (France) earlier this year.The investment manager purchased a 3,600sqm office building in Paris for UMR, with Northstar the seller.The €9.1bn pensions mutual runs four supplementary pensions schemes, the flagship one being the Corem regime.In 2015, the Corem scheme achieved a return of 4.18% on its property investments, which, with a market value of €682m as at the end of December 2015, represented around 9% of total Corem holdings.In its 2015 annual report, the pensions mutual said it remains on the lookout for real estate investments, with a focus on the most dynamic markets, such as office assets in Germany.In other news, France has announced that it plans to issue green bonds, which it said would make it the first sovereign to do so.The announcement was made today by Ségolène Royal, environment minister, and Michel Sapin, minister of the economy and finance; Sapin has taken on the economy brief following the resignation of Emmanuel Macron, who is aiming to run for president next year.The green bond issue is planned for next year, market conditions allowing, according to the ministers. The funds to be raised are intended to go towards financing green investments as part of an investment programme due to be presented this autumn, according to a statement.*As at 30 April 2016 ERAFP, France’s mandatory pension scheme for civil servants, will be looking to “perfect a carbon-free investment strategy” over the coming years, it said after having for the first time disclosed how its equity portfolio is aligned with climate change mitigation goals.Under a new law on the “energy transition for green growth”, French institutional investors have to report on how environmental, social and governance (ESG) considerations in general feed into their investment approach, but also specifically on their approach to climate change-related risks and how this contributes to limiting global warming.The disclosure is required as of next year, to be provided in 2016 annual reports.ERAFP said it decided to “step ahead of these general requirements by setting forth its responsibility to beneficiaries with regard to climate change in its annual report as from this year”.last_img read more

EIOPA investment-statement review raises harmonisation concerns

Posted On Sep 29 2020 by

first_imgEIOPA’s peer review of pension funds’ statements of investment-policy principles provides valuable analysis and recommendations but should not lead to greater harmonisation under IORP II, the secretary general of PensionsEurope told IPE.The European Insurance and Occupational Pensions Authority (EIOPA) last week announced the results of its peer review of pension funds’ statement of investment-policy principles (SIPP).These became a requirement under the original Directive for Institutions for Occupational Retirement Provision (IORPs), with the recently updated IORP Directive (IORP II) adding disclosure requirements and a requirement for the SIPP to explain how environmental, social and governance (ESG) considerations are taken into account.EIOPA found that the statements were primarily used as a supervisory tool by national competent authorities (NCAs) – supervisors, essentially – and said they were key to monitoring the suitability of an IORP’s investment policy and proper risk management. It said the content of the statements “varies between member states and is based on national measures, which the majority of member states have implemented in supplement to the requirements of the IORP Directive”.The supervisory authority’s peer review also identified best practices for supervision and recommended three actions for NCAs, “with the aim to ease the burden on IORPs”.Gabriel Bernardino, chairman at EIOPA, said: “The diverse application of the Statement of Investment Policy Principles in the conduct of supervision across Europe confirms the need of achieving greater supervisory convergence in the European Union already in the early stage of implementing the IORP II Directive for the benefit of the European pension scheme members and beneficiaries.”Matti Leppälä, secretary general of PensionsEurope, told IPE there were a lot of positives about EIOPA’s peer review, but he argued that it should not be allowed to drive harmonisation of practices across the EU.“It makes sense that EIOPA is looking into this process – how the SIPP is used, how it is produced – and there are a lot of sensible, valuable things in the peer-review report,” he said.“People should be open to proposals for improvement, but it is another thing to have it imposed on you because that comes with costs and other things that the pension funds are concerned about.”He pointed out that there are no delegated acts in IORP II and that EIOPA therefore lacks the power to develop the supervisory convergence it has been pushing for with respect to occupational pension funds.He said it was down to member states to implement the requirement for a SIPP, which looks set to be regulated under Article 30 of the new IORP Directive, and that “too much harmonisation” should be avoided.last_img read more

Netherlands roundup: Managers back textile industry fair pay initiative

Posted On Sep 29 2020 by

first_imgVan Lierop said that textile firms would likely speed up wage increases if investors raised the issue. She indicated that the platform expected manufacturers to provide for better wages at their suppliers as well as their own factories.Previously, engagement between investors and big brands such as H&M, Nike and Inditex had mainly focused on labour conditions and safety, Van Lierop said.She added: “If parents get paid sufficiently, they can send their children to school. And staff doing not too much overtime can have a better rest, which improves safety in the factories.”The platform has engaged with 27 textile firms initially, to find out whether they have a policy in place to improve wages in poor countries.According to Van Lierop, this appeared to be the case at half of the companies, with H&M, Puma, Adidas and PVH – the parent company of fashion brand Tommy Hilfiger – at the forefront.She said that some of the lower scoring firms didn’t even know the pay level at their suppliers.PLWF’s second step would be to assess whether policies are applied in practice and whether they lead to higher wages.APG to move office in cost-cutting moveAPG, the €480bn Dutch asset manager and pensions provider, is to leave its offices in Amsterdam’s prestigious Zuidas business district for a cheaper location elsewhere in the Dutch capital.The company said it would combine all its Amsterdam activities in the building Basisweg 10, near Sloterdijk railway station in the west of the city.The move – scheduled for 2021 – is estimated to save €87m during a 17-year lease, contributing to a reduction in the provider’s costs per member. It would be paying less for rent and using less energy, APG said, adding that the new office was to become one of the most sustainable buildings in the Netherlands.APG declined to provide details, but said under an upcoming new contract rent would almost double.The move will involve 500 APG workers in asset management, administration and communication. They will join another 500 employees already working at the new location, which was previously the office of Cordares, the former pensions provider and asset manager of the €58bn scheme for the building sector, BpfBouw.Cordares merged with APG in 2008, after BpfBouw contracted out its asset management and pensions administration to APG.APG Group is the largest pensions provider in the Netherlands, serving roughly 4.5m people and 25,000 employers. Its 3,000 staff mostly work in Heerlen, in the south-east of the Netherlands. It has also offices in Brussels, New York and Hong Kong.ASR backs sustainable EM bond launchDutch insurance firm ASR is the seed investor for a new exchange-traded fund (ETF) from BlackRock, integrating environmental, social and corporate governance (ESG) factors into emerging market debt.The iShares JP Morgan ESG Emerging Markets Bond UCITS ETF will track the JP Morgan ESG EMBI Global Diversified index, one of a range of emerging market debt benchmarks launched by the US investment bank in collaboration with BlackRock last April.It has a total expense ratio of 0.45% and joins 27 other sustainable ETFs offered by iShares, BlackRock’s ETF arm.The asset manager said that the integration of ESG insights into traditional investment approaches had been boosted by country-level regulation, greater awareness and better data.Benoit Sorel, head of products for iShares, said: “The improvement in the quality and coverage of ESG data in emerging markets has enabled investors to identify companies with better ESG performance. With this fund, we are providing investors the ability to integrate sustainability considerations in emerging market bonds portfolios.” Eight Dutch institutional investors, with combined assets of €725bn, have launched a platform campaigning for fair wages in the textile sector in the developing world.The investors – including asset managers MN, Kempen, Achmea IM, NN IP and Robeco – have also targeted banning child labour and excessive overtime. The Platform Living Wage Financials (PLWF) initiative demanded that textile manufacturers increase the salaries of staff in clothing factories to a ‘living wage’.“As shareholders, we can make the difference,” said Karlijn van Lierop, head of sustainability at MN. “International organisations and [non-governmental organisations] have been advocating fair pay in the sector for years, but most multinationals pay labourers in poor countries the minimum wage, which is often much lower.”last_img read more

Performance fees correlated with underperformance, study finds

Posted On Sep 29 2020 by

first_img“As a consequence, combined fees for funds with performance pay were 0.43% higher, and this largely explains the difference in returns between funds that do charge performance fees and funds that don’t,” he said. Henri Servaes, London Business SchoolHowever, Servaes highlighted that not all performance fees were structured in the same way.“Some funds charged a performance fee if they outperformed, while other based the fee on a ‘hurdle rate’, such as the risk-free interest rate,” he added.He said he still supported the concept of performance fees, but only if their structure prevented managers making money from mediocre returns.According to the professor, investment funds with a hurdle rate and a “high water mark” – in which case a performance fee is only paid if a fund’s value exceeds its highest value so far – performed better on average than funds without a performance fee.They achieved an outperformance of 11 bps on average, he said. However, only a small minority of investment funds applied such a pay model.Servaes added that he had failed to find evidence that investment funds charging performance fees were prepared to take more risk to increase their chances of receiving such a fee. Investment funds that charge performance fees achieve worse results than funds that do not, a study has found.In yet-to-be published research, Henri Servaes, professor of finance at London Business School, found that performance fee-charging funds return 50-70 basis points less after costs on average, compared to those that don’t.Servaes, who looked at all Europe-based investment funds between 2001 and 2011, found that 7% of the 10,000 funds in his sample charged a performance fee. They often justified this by claiming that the fee would boost fund managers’ motivation, and that the management fee could decrease as a result.However, the Belgian professor floored both arguments, as he found that the additional costs of a performance fee were not cancelled out by lower management fees.last_img read more

Dutch regulator warns against ‘overheating’ property market

Posted On Sep 29 2020 by

first_imgThe deep crisis on the property market from 2008 to 2012 caused heavy losses for property investors that had been very generous with loans. Dutch bank SNS Reaal was nationalised during the crisis after incurring crippling losses.However, prices for commercial property have risen fast since then, in particular in the Randstad, an area of the Netherlands encompassing the cities of Amsterdam, Rotterdam, the Hague and Utrecht.DNB said it had noticed that the loan-to-value ratio was increasing, and was up to 70% on average. The ratio was almost 80% for rental property.An additional concern cited by DNB was that property tax could be far too high, which might make loan-to-value ratios more risky than they seem.DNB also said market players had indicated property investors relaxing the terms and conditions of deals and setting lower demands for paying off loans.FD noted that interest rates on property loans were falling, with one-third of bank loans carrying a rate of less than 2% for a duration of often less than five years.This meant that hardly any risk premium was being paid, the newspaper said.According to DNB data, Dutch pension funds invested a total of €124.7bn in real estate at the end of June 2018 – roughly 9% of total assets.From the September/October edition of IPE Real Assets: 10 years after Lehman: This time it’s different The Netherlands’ financial regulator has warned against overheating in the commercial property market, as prices are rising fast and leveraged investments are increasing.According to financial newspaper FD, Klaas Knot, president of De Nederlandsche Bank (DNB), urged property financiers “to keep themselves in check”.“We know from the past that vulnerabilities build up during times of boom, and that the worst deals are made at the top of the market,” Knot said during the presentation of DNB’s six-monthly report about financial stability.Knot also warned against the impact of a hard Brexit, trade wars, and a potential correction in financial markets, FD reported.last_img read more

​Danish women’s pension pots 25% smaller than men’s in 2018

Posted On Sep 29 2020 by

first_imgThe data revealed that among savers aged between 25 and 60, women made higher contributions than men relative to their salaries in 2018, paying in 12.3% on average compared to 11.3% for men.“Women are, therefore, more eager to save than men, when the income base is taken into account,” said Danmarks Nationalbank. In absolute terms, however, men made average annual contributions last year of approximately DKK49,000 – 20% more than women, according to the report.Over the past four years, women’s average pension wealth has grown by 7.8%, compared to men’s, which increased by 2.6% in the period, the data showed.“The gap between the Danish men’s and women’s pension assets thus seems to be slowly decreasing,” the bank said, adding that from an international perspective, the gender difference was also smaller than in many other OECD countries. Women in Denmark had pension savings at the end of last year that were 25% smaller than those of men, but there are signs they are catching up, according to a report from the Danish central bank.Danmarks Nationalbank released pension statistics for individuals for the end of December 2018 showing women had average pension savings of just under DKK796,000 (€106,500), while men had more than DKK1.06m in their pension pots.For both men and women, there was a wide divergence in the size of individual pension fortunes, the bank said, with age being the main factor.There were a number of other factors determining pension size, it said, and these related to salary, collective agreements, savings rates and varying labour-market participation due to, for example, maternity and part-time employment.last_img read more

​Varma dumps district heating to halve housing stock emissions by 2023

Posted On Sep 29 2020 by

first_imgFinnish pensions insurance giant Varma has announced plans to cut carbon emissions by half in the residential properties it owns by 2023.The firm, which is one of Finland’s two biggest pension insurance companies – and one of the Nordic country’s largest real estate investors – said it will install heat pumps and solar panels in 36 apartment buildings.In some buildings, geothermal heating will entirely replace district heating, it said, adding that these measures will lead to an estimated 48% fall in emissions its total housing stock by 2023.Matti Lindfors, real estate manager at Varma, said: “These energy-saving measures are worthwhile on many levels, in terms of both profitability and environmental impacts.” Varma said the overhaul will be carried out by eco-tech service company LeaseGreen, and include energy-saving measures such as geothermal heat pumps, solar panels and heat pumps that recover heat from exhaust air.“The reduction in emissions in individual buildings may be a full 100%, which means in the future, residents may be living in buildings that are carbon neutral in terms of energy consumption,” said Lindfors.The new energy solutions are to replace part of the buildings’ consumption of district heating – a form of heating which Varma said currently accounts for a significant proportion of the carbon dioxide emissions from residential properties.Eight apartment buildings will give up district heating as early as this year, and switch to geothermal heating, the firm said.Varma, which manages €47.4bn of earnings-related pension assets, said its goal is to cut carbon emissions in its direct real estate investments by fully switching to fossil-free heating by 2030 and electricity by 2025.The company said it owns a total of 61 apartment buildings, containing around 4,000 flats. Overall, Varma has €4.09bn of real estate investments, including €2.99bn of directly-held properties, according to figures from the end of September 2019.last_img read more

Nundah Queenslander sells to family for $850,000

Posted On Sep 28 2020 by

first_imgThe commercial epoxy flooring were liked by potential buyers.The Queenslander was built in 1920, has four bedrooms, two bathrooms and is on a 607sq m block.Mr Illingworth said the Nundah market remained strong for owner-occupiers, while being a little slower for investors.Video Player is loading.Play VideoPlayNext playlist itemMuteCurrent Time 0:00/Duration 2:28Loaded: 0%Stream Type LIVESeek to live, currently playing liveLIVERemaining Time -2:28 Playback Rate1xChaptersChaptersDescriptionsdescriptions off, selectedCaptionscaptions settings, opens captions settings dialogcaptions off, selectedQuality Levels576p576p480p480p320p320p228p228pAutoA, selectedAudio Tracken (Main), selectedFullscreenThis is a modal window.Beginning of dialog window. Escape will cancel and close the window.TextColorWhiteBlackRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentBackgroundColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentTransparentWindowColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyTransparentSemi-TransparentOpaqueFont Size50%75%100%125%150%175%200%300%400%Text Edge StyleNoneRaisedDepressedUniformDropshadowFont FamilyProportional Sans-SerifMonospace Sans-SerifProportional SerifMonospace SerifCasualScriptSmall CapsReset restore all settings to the default valuesDoneClose Modal DialogEnd of dialog window.This is a modal window. This modal can be closed by pressing the Escape key or activating the close button.Close Modal DialogThis is a modal window. This modal can be closed by pressing the Escape key or activating the close button.PlayMuteCurrent Time 0:00/Duration 0:00Loaded: 0%Stream Type LIVESeek to live, currently playing liveLIVERemaining Time -0:00 Playback Rate1xFullscreenBrisbane market wrap up02:28 The home at 92 Jenner St, Nundah, sold for $850,000.AFTER more than three months on the market, this Nundah home has sold for more than $100,000 above the suburb’s median house price.Worth Real Estate Nundah principal Peter Illingworth said the 92 Jenner St home sold for $850,000 after more than 85 groups viewed the home and the sellers received four written offers. Upstairs has more of a traditional feel.The agent said renovations to the home generated interest among prospective buyers.“They loved the downstairs renovation, as it had been lifted and built in,” Mr Illingworth said.“A feature that was often commented on was the commercial epoxy flooring.”center_img The downstairs renovation was a drawcard with buyers.According to CoreLogic data, the median house sale price for Nundah is $727,500.More from newsFor under $10m you can buy a luxurious home with a two-lane bowling alley5 Apr 2017Military and railway history come together on bush block24 Apr 2019Mr Illingworth said the home sold to a family with two children.“They were attracted to the size, the character, and the convenient location,” Mr Illingworth said.last_img read more