The Dutch pension fund for notaries and their staff (Notariaat) has selected NN Investment Partners as its fiduciary manager, as it wanted to get a tighter grip on the selection and monitoring of asset managers.
Until now, these tasks had been carried by the scheme’s administrative bureau and consultancy Willis Towers Watson.
The €3.2bn sector scheme is the result of a merger between the occupational pension fund for notaries and the industry-wide scheme for their staff that took place in 2017.
“The investment portfolios have also merged, and since then no manager selection has taken place,” said Edwin Zondag, the pension fund’s director.
“Following an assessment of asset management last year, we have concluded that the selection and monitoring of managers was up for improvement, as our bureau hasn’t been set up for these tasks.”
He added that NN IP would play purely an advisory role, as the fiduciary manager would not be allowed to manage any of the pension fund’s assets.
As a result, Achmea IM will continue to implement the interest and currency hedge for Notariaat.
However, pension funds’ views differ on whether these services should lay with a fiduciary manager.
Earlier this week, the pension fund for marine pilots (Loodsen) said it would also outsource this service to its new fiduciary BlackRock.
In addition to advising about asset managers, NN IP would also be involved in setting up Notariaat’s investment plans.
For this reason, the scheme said it would cease using Willis Towers Watson for asset management tasks.
Additionally, teh fund also has plans to replacve Kas Bank with BNY Mellon as custodian as of 1 January.
PFZW to leave premium, accrual unchanged in 2020
The board of the €238bn Dutch scheme PFZW has decided to keep its contribution at 23.5% in 2020, while also maintaining its annual accrual rate at 1.75% of a member’s salary.
It said that it would not be able to raise pensions to keep up with inflation; its coverage ratio must be at least 110% before it is allowed to start granting inflation compensation.
The scheme added that ahead of 2021, it had to make a decision about raising its premiums and/or reducing its accrual rate.
The interest rates level, expected return on investment as well as the new arrangements in the pensions agreement would play an important role in that decision, it explained.
A reduction of the discount rate for liabilities, or an adjustment of mortality expectations, could cause contributions to rise, accruals to be reduced or a combination of both, the pension fund pointed out.
PFZW is responsible for the pensions of almost 2.9m workers and pensioners in the healthcare sector. At October-end, its funding level stood at 94.1%.
The Dutch Pensions Federation said it expected a contribution rise of between 10% and 30% from Dutch schemes, while accruals were to drop from the tax-facilitated level of 1.875% to between 1.3% and 1.5%.