GERMANY - Allianz Global Investors Deutschland and its life insurance cousin, Allianz Lebensversicherungs AG, have founded a joint subsidiary Allianz Treuhand, to serve its corporate pension clients as trustee.
Spokesman Karl-Hermann Hammel today said the new vehicle is designed as a 'so-called' contractual trust arrangement (CTA) and will facilitate outsourcing and outfinancing of corporate pension obligations.
A CTA is essentially a book-reserve funded programme enabling corporate sponsors to leave pension assets integrated within the company's assets, though legally committing them to pension liabilities, is usually set up by a single sponsoring employer, though Allianz has set up a multi-employer trust.
This new unit will also target companies outside of Germany, who might find the multi-employer CTA vehicle cheaper and thus more attractive than setting up a single CTA, said Hammel.
Martin Katheder, managing director of Allianz Treuhand together with March Braun, commented: "In most cases companies gain an upgrade with rating agencies and analysts [when applying a CTA]."
He argues this makes it easier for companies to obtain equity and debt capital under Basle II, "which in turn can improve their international competitive position," concluded Katheder.
"The employer transfers the assets earmarked for this purpose (so-called plan assets) to a trustee, which acts as administrator to the employer and guarantor to the entitled employees," the company said, drawing a parallel to what is often called fiduciary management.
Allianz said its new unit, based in Stuttgart, will mainly focus on small and mid-cap companies.
Allianz Global Investors Kapitalanlagegesellschaft, announced last week it had combined its pension advisory and product design operations in a new business. (See earlier IPE story: Allianz bundles German pension divisions)
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