ICELAND – Talks to engineer the merger of two of Iceland’s largest pension funds have proved abortive.
For the last few months, the €2.1bn Verslunarmanna, Iceland’s largest private sector pension fund, and the €596m Sameinadi, ranked seventh and itself the result of the merger of eight pension funds, have been in discussions about a possible merger.
“The funds have now decided to put an end to the negotiations due to several factors, one of which is the different composition of the funds,” they said in a statement this week.
There have been a series of mergers among Icelandic pension funds. The system was based on trade unions when it was founded in 1969, and each union wanted to have its own scheme. Since then the advantages of scale have become evident.
The breakdown of the latest talks follow the success of two mergers earlier this year. On June 1 a merger between unskilled workers’ pension fund Framsyn and the seamen’s fund Sjomanna was completed to form Gildi, with €2bn under management. And on July 1 Sudurnes and Sudurland merged to form Sudurlands, or Southern Province, pension fund.
The merger of two others, Lifidn (€327m) and Samvinnu (€250m), has been approved by their members and is due to proceed on January 1 while a decision on a union of Almenni Pension Fund (€320m) and the doctors’ pension fund Laekna (€174m) has been postponed until the autumn.