DENMARK – Three Danish pension groups are to form a joint company to offer member services, actuarial service, financial services and IT to other Danish labour market pension funds.
The three – PKA, which administers eight pension funds, kindergarten teacher pension fund PBU and school teacher scheme Lærernes Pension – say that the company would be able to offer high quality services on a large-scale basis at low costs.
Together the three have more than 410,000 members.
“These are all functions where scale is important,” says Peter Damgaard Jensen, CEO of PKA. “However, the new company will not imply any changes in the independence of the three groups. Service level, products and so on will remain a matter for the individual pension funds, as will investment strategies and investment management.”
Subject to final approval of the three boards, which is expected by June, the as-yet-unnamed company will be established on 1 September. It will be based on PKA’s current service functions and be owned jointly between the three groups.
The eight PKA pension funds will be the company’s first clients. Service to PBU will be implemented mid-2007 and to Lærernes Pension in early 2008.
Currently, Lærernes Pension takes these services from PFA, a life and pensions insurer providing corporate pension schemes, and PBU from ATP, the Labour Market Supplementary Pension Scheme.
"We have had a good and fruitful co-operation with PFA over 13 years,” said Lærernes Pension chairman Anders Bondo Christensen.
“From the outset the idea was that PFA should only support Laernes Pension during the build up phase. Because the co-operation was so advantageous, it has continued over a longer period. Now the possibility has arisen of entering into a joint administration with two labour market pension companies with the same structure as us and we are looking at that."