DENMARK - BankPension has entered into a "strategic co-operation" with the individual pension company letpension to establish a joint management company.

The agreement will take effect from 1 January 2009, and is said to allow both companies to achieve economies of scale, although BankPension and letpension will remain as separate pension insurance companies and would therefore not result in a reduction in staff.

BankPension had around €1.7bn in assets in September and provides pension insurance for around 15,000 employees in the financial sector, while letpension - which was established in 2006 - offers insurance to individual customers, and has shareholders from 100 Danish banks.

Under the terms of the agreement, the joint management company will aim to achieve "synergies" in the operating and development of pension products to both banking customers, and financial staff as, to a large extent, the two companies provide the same services and have the same needs in a wide range of areas.

Niels-Ole Ravn, director of BankPension, said the collaboration was an opportunity to "future-proof" the company and improve its chances of survival.

"There are many positive aspects of cooperation. The most important thing, however, is that many of our member companies will have the pension scheme for employees and customers in the same place. This synergy between what employees have, and what they sell to their customers, will link our member companies closer to us. At the same time we will be stronger compared to the competition," added Ravn.

Per Munkholm Poulsen, president of BankPension suggested the agreement would bring significant benefits in the long-term, "not least when it comes to developing new products and new IT, where letpension has many exciting initiatives under way".

The new joint management company will from January include Niels-Ole Ravn, from BankPension, as the managing director and Jorgen Reske-Nielsen, chief executive of letpension, will become a director, while both individuals will also join the board of the other company as a director.

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