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Aba pushes for separate pension supervisor

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  • Aba pushes for separate pension supervisor

GERMANY - The German government has been urged by the country's occupational pension association (Aba) to create a separate entity for pension supervision.

The government is currently negotiating a possible split in supervisory remits between the existing BAFin and the Bundesbank, following the inauguration of a new coalition government last year. But Boy-Jürgen Andresen, chairman of Aba, told delegates at the organisation's annual conference in Bonn on Tuesday that "the creation of a special interest group for occupational pension providers within the new financial supervisory structures is inevitable".

Andresen acknowledged that current supervisory structures were "functioning well" and had helped German occupational pensions to weather the recent financial storms, but at the same time he argued that government reform plans needed to further address the increasingly important area of occupational pensions.

Steps have already been taken in this direction on a European level with the creation of the EIOPA pension supervisor (see earlier IPE-story: EIOPA might end up with fewer powers - Bernardino). Andresen complained: "On a national level this still has to be implemented".

Andresen said a specialised supervisor could help address long-standing issues, such as regulation regarding sources of profit. "Occupational pension providers, which are making profits directly available to their beneficiaries, still have to go through the very laborious and - as we think - unnecessary process of separating various sources of profit, just like insurance companies have to separate company profits from clients' assets," he bemoaned.

No decisions have been made over the government proposals to split supervisory remits between BAFin and the Bundesbank, although politicians have so far dismissed calls by the latter for it to assume over-archiing responsibility.

Hans-Ludwig Flecken, head of the state pension department in the German social and labour ministry, came out in favour of the pension association. He said: "We support demands by Aba to create a board for occupational pension supervision in any new supervisory structure".

But Thomas Steffen, head of BAFin, was cautious about the reform plans, and argued that the existing joint supervision of insurers and banks had proven itself in the crisis and should not be split.

The BAFin will also commission a study into possible changes to Germany supervisory structures over hte next week with results expected by the end of 2010. "We want to get some outsiders' expertise on the issue," Steffen said.

Should all supervisory remits go to the Bundesbank, Steffen said he still hoped for independent supervision of Pensionskassen and Pensionsfonds. "Occupational pension providers are not banks," he said.

 

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