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Allianz merges its two Dutch pension funds

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The two Dutch pension funds of insurer Allianz Netherlands have merged into a new, €662m pension fund, called Allianz Nederland Groep.

The Buizerdlaan pension fund contributed €200m to the new scheme while Pensioenfonds Allianz Nederland added €448m to the combined assets. The pension funds have 930 and 3,100 participants, respectively.

In their respective annual reports, the boards of the schemes said the merger decision followed an exploration of the future options.

They dismissed joining a general pension fund (APF) or a sector scheme but indicated that the new combination left the option of joining an APF within five years.

Buizerdlaan was the pension provider for staff of former insurer Zwolsche Algemeene, which fused with Royal Nederland in 2003, creating Allianz Nederland.

The schemes pointed out that the union was aimed at reducing complexity and gaining synergies for investment and administration.

Buizerdlaan’s administration costs per participant were €1,927, whereas Allianz Nederland paid €733 for pensions provision.

Last year, supervisor DNB had tasked Buizerdlaan to draw up an improvement plan after an on-site investigation revealed its decision-making and risk and investment management were not up to scratch.

Both schemes had reported combined costs of 0.2% for asset management and transactions.

Allianz Global Investors carried out asset management, while Allianz acted as pensions provider.

The now merged schemes had already shared many functions, including an administrative bureau, four advisory committees as well as a number of board seats.

Their asset mix as well as their coverage ratio were largely the same. Funding of Buizerdlaan and Allianz Nederland stood at 111.7% and 110.7%, respectively, at the end of March.

Both schemes also implemented average salary arrangements.

Precedents

The consolidation trend among Dutch pension funds has also been in evidence at companies with several pension funds as a result of past mergers.

Last year, cardboard firm Smurfit Kappa fused its two pension funds, while the four schemes of telecoms firm KPN merged into one.

The engineering companies Haskoning and DHV merged their compartments in a multi-company scheme, while Aon Hewitt is in the process of uniting the pension funds of the old merger partners Aon and Hewitt, possibly into a new Belgian-based pensions vehicle.

In a contrast to these moves, ING and Unilever established new collective defined contribution (DC) schemes for new employees and further accrual for existing staff, in addition to their old pension fund with a DC plan. Shell introduced a new individual DC scheme, SNPS.

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