GERMANY – Consulting firm Rauser Towers Perrin is advising Germany’s DZ Bank on the construction of an external fund, known as a contractual trust arrangement (CTA), for €1bn in pension liabilities, industry sources say.
The nature of Rauser Towers Perrin’s mandate was not clear, said the sources, who spoke on the condition of anonymity. On Thursday, other industry sources told IPE that DZ Bank had set up the CTA and was selecting managers to invest its assets.
Neither Towers Perrin nor DZ Bank, a central bank for German co-operative banks, was willing to comment on the developments.
In building a CTA – a process which more than 20 Dax-30 companies and several other big non-listed have already gone through – the company first removes its pension liabilities and packs them into the fund. The company then typically commissions an asset-liability study on which the CTA’s asset allocation will be based. This is followed by the selection of asset managers.
Prior to its acquisition by US-based Towers Perrin last July, Rauser was known more for actuarial services and pensions advising than for investment consulting.
DZ Bank is Rauser’s second high-profile mandate since the summer. In June, it emerged that Rauser had been hired by German engineering giant MAN to help it set up a CTA for €1.7bn in pension liabilities and advise the CTA on strategic asset allocation.
Industry sources noted that DZ Bank’s selection of Rauser was not that surprising, as the house was the bank’s actuary.
Under the merger between Towers Perrin and Rauser, Towers’ 290 employees in Germany were combined with around 100 from Rauser. The new company operates offices in Frankfurt, Cologne and Reutlingen, near Stuttgart.