SWEDEN - A former managing director of consultancy Aon has been appointed investigator for the Swedish government's review of the AP system that could result in the closure of as many of two of the country's buffer funds.

Mats Langensjö, who in the past has worked for consultancies Mercer and Aon - as well as at Wassum Investment Consulting, Goldman Sachs and more recently Pioneer Investments - was selected by the country's ministry of finance and the cross-party Pensionsgruppen to lead the review announced in June.

As part of the review, the investment rules and governance structures for the first four AP funds will be examined, as well as the benefits and risks that could be posed by a possible consolidation of their assets into fewer vehicles.

The ministry separately highlighted the role of AP6, saying its targets and investment guidelines would be reviewed based on the role it played within the AP system.

Speaking to IPE, Langensjö was careful to stress that no decision had been made regarding any scheme closures.

But he did say the government would reconsider the number of AP funds if it allowed for greater economies of scale within the country's buffer system, while avoiding a concentration of share ownership.
Asked about why AP6 had been singled out for review by the ministry of finance, he explained that the laws governing its investment structure were in need of examination following its launch in 1996.

He said there had been "ongoing discussions" about the possibility of AP6 - which currently only invests in Swedish private equity - considering investment outside of the domestic market.

Peter Norman, minister for financial markets and a former chief executive at AP7, said the review was needed due to the significant concentration of pension assets within the buffer funds, which at the end of last year managed SEK895bn (€99.5bn).

"We therefore have a responsibility toward current and future pensioners to ensure this capital be managed in the best possible manner, at minimal cost," he said.

"The current regulatory framework has remained largely unchanged for over 10 years, and, therefore, we need now to review it."

The review will publish its findings in a year's time, at the beginning of August.