Bosch launches new supplementary fund

GERMANY – Stuttgart-based household appliance manufacturer Robert Bosch has launched a new supplementary pension fund for its 102,000 domestic workers. The company is awaiting regulatory approval from the German federal financial services supervisory board, BAFin.

The new fund will initially operate alongside the company’s traditional book reserve retirement fund, currently worth €4.4bn, but the overall set-up may change in the future, says a spokesman for the company.

“The traditional book reserve system is expected to remain in place for the time being. How our retirement provision practice develops in the future depends on the success of the new pension fund.

"The main difference is that the employees will be the sole contributors to the new fund, whilst they don’t actually put into the book reserve. That is paid for entirely by the company,” he says.

Munich-based Allianz Dresdner Asset Management (ADAM) will be the pension fund’s sole investment manager whilst Wiesbaden-based investment consultancy, Heißmann, will take care of its administration.

Though Bosch has already chosen an asset manager, the finer details of the fund have yet to be determined. “It’s too early to say how the assets of the new pension scheme will be invested or split among asset classes. These decisions will depend on the outcome of an ALM we intend to undertake once we are ready to begin operating,” says the spokesman.

The new Bosch fund is the latest in of a series of new supplementary pension funds being created by some of Germany’s major companies. Deutsche Telekom, die Post and Deutsche Bahn have all outlined plans for their new retirement provision systems recently.

Influenced by the Riester pension reforms, the creation of the new company schemes comes at the same time as the establishment of the new industry-wide pension schemes in Germany. The metal, chemicals, trade, banking and finance, and building industries have all recently set up new schemes or pension fund companies to cover their respective sector.

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