Latest from IPE Magazine – Page 525
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Features
Proving FRR's credentials
Almost five years after its creation, the French Fonds de reserve des retraites (FRR) has experienced only one full real year of financial management, in 2005. Let’s remind a brief history of the FRR. France, like many others, has to face a retirement problem with its existing system being unable ...
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Features
New environment for pensions
Following the law on pension reform in 2003, the different regulations that we were all waiting for have finally been published. The result is a much clearer (and attractive) pension environment than before. Companies can sponsor three tax-favoured retirement systems – traditional DC and DB plans, and the new locked-in ...
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Features
Portability plan in limbo
Despite the commission’s prevailing optimism that last-minute tweaks would have saved its pensions portability proposal from sinking beneath a quagmire of inter-governmental wrangling, those that are now handling the dossier say that it is looking decidedly more troublesome than they first allowed for. For one thing, Austria, which currently has ...
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Features
EU action may boost funds
With the exception of Italy, Denmark and Sweden, all EU member states apply either the EET or the TEE system to pension taxation. EET means that the pension contributions are ‘exempt’, that is the contributions are deductible from the taxable income, the investment results of the fund itself are also ...
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Features
A hitchhiker's guide to LDI
Once the decision has been made to implement a liability driven investment (LDI) strategy to provide protection against interest and inflation rate movements, the implementation process still lies ahead. There are a multitude of different areas in the implementation process that will require simultaneous attention. It is vital for the ...
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Features
Europe on slow crawl upward
Yield curve/duration The ECB duly raised its Refi rate to 2.5% on 2 March, a move which came as no surprise to market participants. What had more influence on the short end of the yield curve were comments from the ECB. Firstly, president Trichet said the bank was “ready to ...
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Features
Dipping a toe in the water
Investing in alternative assets by French pension funds is still not common. “This is generally due to a poor understanding of alternative betas and especially the restrictive regulations,” says Noel Amenc, professor of finance and director of the Edhec Risk and Asset Management Research Centre. Other observers point to the ...
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Features
Evolving the system
French retirees draw two or three pensions. The basic pension is paid by the state social security system. On top of that there is a complementary pension paid by an Arrco institution and, for managers, a management pension from Agirc. On average the basic pension represents 60% of their total ...
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Features
Moving into a new phase
The European directive of 2003 concerning the activities and the regulation of occupational pension funds was adopted following a very long and difficult process. All things considered, the impact of this directive is very limited for a country like France1. Nonetheless it is a good starting point for us to ...
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Features
Learn to love tight spreads
We live today, in a somewhat surreal world where, as Tim Bond, the author of the Barclays Capital Equity Gilt Study points out, £800bn (€1.2trn) of final salary UK pension schemes are trying to buy £41bn of long dated index-linked gilts, which he likens to an elephant trying to squeeze ...
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Features
X marks the treasure spot
Danish mortgage bonds have long been an attractive fixed income investment for Danish investors. Now foreign investors have also discovered the advantages of Danish mortgage bonds which offer a considerably yield pick-up and strong diversification effects. “There is no such thing as a free lunch”. A classical economic dogma and ...
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Features
Making the breakthrough
In 2000 the Taxation of Pension Investment Returns Act was introduced in Denmark. Like a good new year’s resolution it promised a simpler taxation regime for all, and a gateway for foreign asset managers wishing to break into the domestic Danish market. Five years of freedom have seen major growth ...
