BGL gets go ahead for first of three ASSEPS
LUXEMBOURG- Banque Generale de Luxembourg (BGL) has launched an ASSEP for its Luxembourg-based senior managers after it received regulatory approval at the end of December. BGL expects to receive approval in the next few weeks for a SEPCAV catering for employees below senior management level.
The SEPCAV, subject to approval, will contain three lifestyle compartments with an additional compartment with a certain guarantee, as yet undecided.
Michel Duhr, business development manager at BGL, says they made the distinction between the groups of employees for reasons of confidentiality. Senior managers negotiate individually with the bank rather than relying on the unions and are therefore cagey about disclosing their salaries.
There is another distinction, one that depends on the length of service to the company. Anyone who joined before 2000 will automatically enter an ASSEP, anyone after, a SEPCAV.
Duhr says this is due to consistency. BGL was the first company to launch a defined benefit Caisse de Pension for its employees back in 1970. Legislative changes in 1999 gave these older funds until 2000 to conform to the new laws, hence the decision to make the distinction.
The ASSEP will be defined benefit while the SEPCAV will be defined contribution. “For the sake of the employees we wanted to keep a little bit of consistency,” he says.
BGL wants to offer employees the choice of investing in either type of vehicle and in order to enable this, is launching an ASSEP for the less senior employees and a SECAV for senior management.
BGL is providing all the services needed to run and maintain the investment vehicle. The only external advisors it is using are Anderson as auditors and local actuaries Isofac.
The bank is also setting up two further SEPCAVS and an ASSEP for third party clients that should be open to other companies.