NETHERLANDS – The Dutch central bank has set up a working group looking at ways of making the country an attractive domicile for pension funds, in the context of the directive on occupational pension funds.
“Where possible, we must continue our efforts to capitalise on national and especially international developments,” said DNB president Nout Wellink.
“Take, for example, the EU pension directive which entered into force in September 2005. This directive allows European employers to place pension commitments with pension funds in another EU Member State.
“Given its comparative advantages and its avant-garde position in the development of risk-based capital requirements for pension funds, the Netherlands is an attractive domicile for such institutions. Here lie opportunities for the Dutch pension industry.”
He told a conference organized by Fortis that, in conjunction with the Ministries of Social Affairs & Employment and of Finance, a working group at De Nederlandsche Bank is currently investigating how the Netherlands “could become even more attractive as a domicile for pension funds”.
The group is currently putting out “feelers” within the sector and would welcome suggestions, Wellink said – adding that ideas can be submitted via the DNB’s website.
He told delegates: “The Netherlands not only has one of the best capitalized pension sectors in the world, it also has much experience of pension insurance.
“This country harbours much knowledge and skills in the areas of asset-liability management, portfolio management, actuarial expertise, information technology, tax and pension legislation and administrative processes.”
In terms of asset pooling, he said the country “offers a surprising potential investment alternative” that was comparable to Luxemburg and Irish constructions.
Nellink called for discipline and transparency. “For a pension system to be durable, all players must abide by the rules,” he said. And he robustly defended the idea of buffers for allowing stable contributions and lasting indexation.
“Buffers furthermore offer protection against downward risks, as well as the advantage of extra return, which can be used to realise indexation ambitions.”