June 2021
04Jun

Pandemic spurs cautious plan changes among pensions

Pension plans are cautious about making plan changes, despite the improved economy following the pandemic, according to a survey by Mercer and CFO Research. The report is based on responses from 201 senior finance executives at firms with $500 million or more in annual revenue. About a third of respondents said they were taking advantage of relief in the American Rescue Plan Act to change funding thresholds to avoid benefit restrictions or participant notices, but only 15% expect to speed...

June 4, 2021
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04Jun

Why retirees need to heed the ‘sequence-of-returns risk’ in their portfolios

When world markets took a nosedive in the early days of the COVID-19 crisis, many investors worried about the hit they saw on their returns in monthly statements. Those in the early days of retirement were particularly lucky that the pandemic-driven plummet proved to be short-lived. A prolonged downturn of that magnitude at the start of the period when you’re drawing on investments can have disastrous consequences on your long-term portfolio performance, experts say. Still, there are pre-retirement strategies that...

June 4, 2021
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04Jun

Botswana’s $7.5 billion pension fund appoints South African administrator

Botswana’s Public Officers Pension Fund (BPOF), with 83 billion pula ($7.85 billion) in assets under management, has appointed South African advisory firm NMG Benefits to administrate the fund. Effective June 2, NMG Botswana, a joint venture between BPOPF (51%) and NMG South Africa (49%), will collect contributions, manage payrolls and maintain records for the 156,000-member fund, it said late on Wednesday. The outsourcing of the fund’s administration is to comply with a 2017 decision by Botswana’s regulators that all pension funds...

June 4, 2021
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03Jun

US. Pension risk transfer premiums hit record low – paper

Pension risk transfer premiums are lower than ever, according to a paper from pension risk consultant BCG Penbridge. The consultant was involved in 53 PRT transactions in 2020, involving the purchase of group annuity contracts by U.S. corporate pension plans to transfer a certain number of retirees and pension liabilities to one or more insurers. Among those transactions, 42 were full plan terminations, and the average premium was 101%. Among the 11 PRT transactions that involved retiree liftouts, the average premium was...

June 3, 2021
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03Jun

BlackRock wins monumental mandate

BlackRock will be the outsourced chief investment officer (OCIO) for $39.9 billion (£21.5 billion) of British Airways Pensions' assets. The mandate is for the investment management of Airways Pension Scheme (APS) and New Airways Pension Scheme (NAPS) which serve more than 85,000 members. Both APS and NAPs where previously managed by British Airways Pension Investment Management (BAPIML). The choice to externalise the investment management came from increased regulation, operational costs and investment complexity in the UK pension scheme industry. In addition, the schemes...

June 3, 2021
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03Jun

US. 401k Savings, Account Balances Grew During Pandemic

Closed restaurants and movie theaters meant more disposable income for retirement savings during the pandemic. T. Rowe Price is out with its annual Reference Point 401k benchmarking report featuring year-over-year data and analysis on participant behavior and plan design, and the results were positive, all things considered. “While the financial, physical, and emotional strains caused by the pandemic had, and will continue to have, repercussions on plan design and retirement savings outcomes, it was encouraging to see that through it all,...

June 3, 2021
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02Jun

UK. Pensions Regulator Urges Robust Liquidity Risk Analysis

Trustees of retirement saving schemes have improved their understanding of the liquidity risks facing their programs, but they should be more robust when they analyze those dangers, a director at the pensions watchdog has warned. David Fairs, an executive director at The Pensions Regulator, said that major government and central bank intervention programs around the globe in late 2020 — such as lowering interest rates — helped to stabilize markets during the coronavirus outbreak. But interventions in the future cannot...

June 2, 2021
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02Jun

Kenya’s civil service is ageing, but adjustments aren’t being made

The demographic profiles of countries like Kenya, where a high percentage of people are young, would suggest that it’s swiftly renewing its workforce with fresh talent. But this doesn’t seem to be the case. We conducted a study in a public sector organisation three years ago. We found that the bureau had an ageing workforce. More than half of its staff were 50 years old and above. The majority of employees were aged between 51 and 60. This suggests that, in...

June 2, 2021
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02Jun

Nigeria. Still on corruption in pension scheme

The recent expose by the British Broadcasting Corporation (BBC) on corruption in Cross River State, shocking as it were, is but one of the many plagues currently ravaging this country, which would explain why it barely elicited the deserved reaction from average Nigerians, as they have to deal with these situations on a daily basis. It is no longer a question of the magnitude of corrupt practices in the system, which is not in doubt, but one of who...

June 2, 2021
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02Jun

CPPIB, Phoenix Mills to Develop Retail Center in India

The Canada Pension Plan Investment Board (CPPIB) is developing a shopping center in the affluent Alipore, Kolkata, neighborhood in India, as part of a new joint venture with mall operator Phoenix Mills. India is an important destination for CPPIB, the pension fund said last week. The joint venture will fund the mall with about $77 million (C$93 million), which will be invested in tranches into Mindstone Mall Developers Private. After construction is completed in the latter part of 2024, CPPIB will...

June 2, 2021
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