The German financial supervisory authority, BaFin, has granted the German subsidiary of the Swiss consulting company Complementa permission to offer securities-related services and investment advice in Germany.
Complementa’s subsidiary, which operates from Munich, plans to take on fiduciary management in the near future to provide consultancy services to institutional investors in Germany.
“We are very pleased to be able to offer our customers an even more comprehensive range of investment advice, investment controlling and investment reporting [services] in the near future,” said Eberhard Schwarz, managing director of Complementa in Germany.
“With our existing know-how we can offer a broader range of services on financial governance issues in Germany and offer our customers an advantage in terms of planning, design and monitoring of their investment processes,” added Heinz Rothacher, Complementa’s chief executive officer.
Pension liabilities of Swiss largest firms shoot up
Liabilities of pension schemes of Switzerland’s largest companies listed on the Swiss Leader Index (SLI) have seen a 4% increase between the end of 2022 and May 2023, as discount rates declined by about 0.25%, according to the Pension Risk Study conducted by WTW.
However, if national banks decide to further increase interest rates, discount rates will also rise again, WTW added. Future increase of wages and of pensions, granted because of inflation, could offset some of the decrease in liabilities, it warned.
“The introduction of 1e plans as well as the adjustment of benefit parameters and financing are continuing to stabilise liabilities,” said Christian Heiniger, pension fund expert and senior director at WTW in Zurich.
He added: The optimisation of the investment strategy together with the liabilities can, within the framework of an asset/liability management study, lead to an increase in the expected return on assets while maintaining the same level of risk. This can thus create better conditions for both employees and the employer in meeting the challenges ahead.”
The funding ratios of pension plans of Switzerland’s largest companies improved year-on-year in 2022 to 99%, from 92% in 2021, according to the Pension Risk Study. Plan assets fell year-on-year in 2022 by 18.3%, or CHF37.6bn, but liabilities plunged even more by 23.7% or CHF47.8bn.
German Pensionskassen free from additional guarantee reserves
German Pensionskassen do not have to set up additional reserves to guarantee promised benefits, as it has happened during the low-interest-rate environment, BaFin’s executive director Frank Grund said, speaking this week at a conference organised by German insurance association GDV in Berlin on insurance regulation.
As a result of the rise in interest rates, pension funds’ key financial figures have improved, with opportunity for returns through new and re-investments, which is also good news for members who benefit from the higher returns on investment, Grund added.
Many Pensionskassen have made great efforts to lower their discount rates in the low-interest-rate environment but, Grund said, there are still pension funds where the actuarial interest rate is higher than the current return on fixed-income investments.