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IPE special report May 2018

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Vitol Anker shifts pension scheme from Netherlands to Luxembourg

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The €62m Dutch pension fund for commodities firm Vitol Anker (SPFVA) has liquidated and placed its pension plan with insurer Integrale Luxemburg.

It is the first time a Dutch scheme has moved across the border to the Luxembourg-based insurer, and Integrale said there was growing interest in this option.

SPFVA said the Dutch regulator, De Nederlandsche Bank (DNB), had concluded that the scheme was vulnerable and its board needed to spend a disproportionate amount of time running it. It had a funding level of 94% at the end of 2015, and 550 participants in total.

SPFVA indicated that, by involving the insurer as of 1 January this year, it was able to prevent rights cuts.

The new pension arrangements run by Integrale are purely defined contribution (DC), whereas the previous plan combined defined benefit and DC. The DB element applied to the first €35,000 of an employee’s salary, and DC applied to any remainder up to the national cap of €100,000.

The scheme’s board emphasised that the new plan would produce the same pension result as the old scheme, and added that Vitol Anker would not financially benefit from the changes.

On its website, the board said that the Luxembourg arrangements required an employer’s guarantee if agreed returns weren’t achieved. It declined to provide additional details about its choice.

The board made clear that it would keep administration and communication in-house, provided by Anchor Insurance Rotterdam, one of the scheme’s affiliated employers.

SPFVA implemented the pension plan for fuel trading firm Vitol, oil storage and transport company VTTI, DUPI Insurance Group, and Anchor Insurance.

Integrale Luxemburg – a subsidiary of parent company Integrale Belgium – said that Vitol Anker was the first Dutch pension fund that had placed its pensions with the insurer.

It cited Dutch pensions advisers indicating more interest for its proposition, but said that it was not in talks with other candidates.

Integrale was also reluctant to provide more details of insured arrangements in Luxembourg.

“We know how sensitive the issue is in the Netherlands,” a spokesperson said. “But of course we would be happy to point out the benefits to interested parties.”

Integrale Luxemburg said it was particularly focused on smaller pension funds with assets of up to €200m. It also offers other services including fiduciary management, reporting, and compliance.

French asset manager Amundi has recently set up a Luxembourg-based pan-European pensions vehicle for DC plans, aimed at European schemes of multinationals. Last December, it said it already had a dozen clients.

Amundi offers both asset management and administration, and claimed that asset management costs in Luxemburg were 30% lower than elsewhere in Europe.

It added that supervision in Luxembourg was no less strict but more flexible than in the Netherlands and Belgium.

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