UK - Corporate employers are keen to de-risk their defined benefit plan pension arrangements through a buy-in or buyout But research suggests the big worry for many is whether they have the assets to finance it, so they may turn to do-it-yourself methods.
Clear Path Analysis has conducted of survey of 30 director or senior representatives of buyout solutions and found a third (33%) believe lack of capital to fund buy-ins or buyouts could stand in the way of the markets continued growth so they predict a growth in buy-in and buyouts over the next two years.
Findings of the survey were delivered ahead of a report on this subject.
Interestingly, at least a quarter of respondents believe the costs of transacting in such deals will rise, perhaps in part because 27% of respondents feel there is low capacity in the market for continued growth and 24% believe more education is needed around transaction pricing.
It's not all down to pricing concerns, however, as the poll found almost three in 10 (29%) still need more education to help their fundamental understanding of what a buy-in and buyout is while 18% want guidance on the alternatives to pension buyouts.
The CPA also predicts demand will in the immediate future come from small to medium-sized pension schemes with less than £500m (€560m) in assets, providing companies have the cashflow to reinsure member benefits.
A report based on the findings of this survey will be published by CPA next month.
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