Latest analysis – Page 57
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Features
Alphabet soup
The UK’s pensions minister, Steve Webb, is brave to try to keep alive the concept of pensions risk sharing. At the annual chairman’s dinner of the National Association of Pension Funds (NAPF) in February, he advocated what he termed ‘defined aspiration’ or ‘DA’ pensions to add to the already familiar DB and DC.
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Features
No Tobin for pensions
The concept of a universal financial transaction tax is a flawed one.
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Features
Returns up despite equity losses
Considering the year that was 2011, many pension fund CIOs would have been happy to balance out equity losses with returns in other asset portfolios. This is the situation for most pension funds to report their 2011 results – with diversification able to offset the volatile equity market that for some schemes led to losses of 20% in stock holdings.
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Features
Do hedge funds delay reporting to save face?
It is well known that databases of historical hedge fund returns suffer from a range of biases – chiefly ‘survivor bias’. The worst funds cease reporting their results, sometimes simply because they go out of business, and some of the best stop reporting when they no longer need to raise assets.
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Features
Trouble at the top
The news that Dutch civil service pension scheme ABP is suing Goldman Sachs over claims of a mis-sold collateralised debt obligation (CDO) raises questions over what counts as adequate due diligence. The €246bn fund – which has already sued Credit Suisse, Deutsche Bank and JP Morgan over the same issue – alleges in a complaint filed in New York that the bank knew the product was riskier than it let on.
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Opinion Pieces
Long-term Matters: Stop enabling corruption
My invitation to Prague last November had one drawback. The seminar was about corporate and political corruption. How depressing. Still, invited by the liberal Brookings Institution and the conservative American Enterprise Institute and convened by a leading US ambassador, how could I refuse?
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Features
J’en ai marre
IASB project manager Denise Durant’s opening words to the 18 January IFRS Interpretations Committee meeting were innocuous enough: “We are not discussing the proposed amendment to IAS 1 derived from the conceptual framework because this amendment was proposed directly by the board and not by the committee.” Instead, she explained, the amendment “is going to be discussed at a later stage by the board.”
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Opinion Pieces
Kees Cool, Groningen University, and Anton van Nunen, Syntrus Achmea
For the first time since the introduction of the Dutch pension law in 1954, pensioners are to be told that their pensions will be cut by 3-4% from April 2013. Also, companies might be forced to pay extra contributions. The stated reason for this is the low coverage ratios of pension funds. But that this is not correct. By calculating a wrong coverage ratio, employees and pensioners are unduly and unnecessarily hurt, and economic growth is frustrated.
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Opinion Pieces
Politicians vs pensions
Two strongly divergent positions concerning the European Commission’s proposals for a financial transaction tax (FTT) have emerged in Brussels. Pension fund interests vehemently oppose the tax, while other parties, including some members of the European Parliament, take a diametrically opposite view.
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Opinion Pieces
Bankruptcy wave threat
A new wave of bankruptcies is set to put more pressure on the Pension Benefit Guaranty Corporation (PBGC), the US pension agency that insures pension benefits of private pension plans covering some 44m of America’s workers and retirees. For fiscal year 2011, the PBGC has already reported a record $26bn (€19.8bn) deficit – the largest in its 37-year history and $3bn more than the $23bn deficit reported the previous year.
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AnalysisNews analysis: The (Chinese-owned) road to riches
China is targeting European 'recovery' infrastructure assets – but not as you might expect.
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AnalysisNews analysis: Why are pension funds suddenly guarded on infrastructure?
As government plans grow more ambitious, pension funds grow more cautious.
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Features
DNB’s new interest-rate average will limit cuts
The Dutch Pension Federation, and the largest pension funds, ABP, PFZW and PMT, cautiously welcomed the pensions regulator’s recent decision to adopt a three-month interest-rate average to calculate the yield curve.
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Features
Sovereign debt crisis hits pension fund results
As pension funds across Europe release their preliminary results for 2011, the issue of the sovereign debt crisis is likely to dominate. Whether it be a shift in asset allocation – away from the few remaining periphery bonds generally held – or the fact liabilities escalated after a country’s debt ...
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Features
Revised IORP puts pensions industry on alert
Last month IPE noted that 2012 would be an important year in terms of regulation for pension funds as the industry awaits a White Paper for a revised IORP directive. Needless to say, the first few days of January have already confirmed those thoughts as the pensions industry submitted its ...
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Features
Leader of the supertanker
ABP transformed itself in 2008 when it spun off APG to become an independent pension asset manager that could also manage assets for external pension funds.
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Features
Back to business
In the April 2010 edition of IPE, I wrote on these pages about my amusement that active managers always think it’s “a great time for active management”. I thought that uncertainties around the euro-zone, China’s economy, forthcoming elections and ‘geopolitical hotspots’ would keep us firmly in a ‘risk-on, risk-off’ world with stubbornly high market correlation.
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Features
Pawns in need of a knight
Eastman Kodak retirees, both present and future, would appear to be in need of a hero. They will be wringing their hands over the news that the company filed for bankruptcy protection in late January. Those based in the UK, however, are likely to be a bit more concerned about their retirement, and with good reason.
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Features
A different world
Now we have reached the ripe old age of 15, IPE has achieved a fairly good perspective on things. Back in February 1997 when we published our first issue, e-mail was a novelty and hand-held computing devices were a twinkle in someone’s eye.
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Opinion Pieces
Long-term Matters: Learning from bailouts
Why do bankers still not get their part in, to use Ken Rogoff’s phrase, the ‘Great Recession’? And what have institutional investors learned from these bailouts? An interesting CFA Institute blog shows that bailouts today are more frequent and more destructive than ever before. Unsurprisingly, the ‘why’ is deeply contested. Here’s my diagnosis to balance orthodoxy.
