December 2020

30Dec

US. Multiemployer Pensions Update: A Lump Of Coal In Their Christmas Stockings

How do you write about something that didn’t happen? On Sunday night, President Trump, after much delay, signed the combo Covid-relief and omnibus appropriations bill. Since I had been bookmarking a variety of articles that anticipated the inclusion of retirement related provisions in that bill, and even more voices calling for the need to resolve the multiemployer pension crisis (which I myself last addressed in October), I looked at the text as soon as it was made available, went...

December 30, 2020
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29Dec

US. Pensions Swamped in a Sea of Negative Real Rates

Defined-benefit pension plans were already barely treading water heading into 2020. In the years ahead, the risk is as great as ever that a large swath of them will drown. As the name implies, defined-benefit pensions promise to pay a set amount to retirees. While corporate America has largely moved away from this structure in favor of 401(k) options (or “defined contribution” plans), virtually all state and local governments still offer these reliable retirement payouts. And they’ve been falling...

December 29, 2020
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29Dec

Time is now for Canada’s public pension giants to invest in a safe climate future

As 2020 came to a close, the federal government made laudable plans to cut carbon pollution faster and deeper. But we haven’t seen similar commitments to climate action from a massive pool of capital over which Canadians have real power: our pension funds. Canada’s 10 largest public pension funds alone manage nearly $1.8 trillion — an amount approaching the size of the country’s annual GDP. These pension giants own sizable pieces of the real economy and hold significant shares...

December 29, 2020
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28Dec

Companies end year by shipping off pension liabilities

Pension funds on both sides of the Atlantic offloaded $14.5 billion in liabilities through pension risk transfer deals this month alone, including two huge longevity swap announcements. Most of the action took place with U.K.-based plans, but in the U.S., General Electric Co., Boston, announced it transferred $1.7 billion of its U.S. GE Pension Plan obligations to retirement services firm Athene Holding Ltd. through an annuity buyout. As part of the transfer, Athene will provide payments to roughly 70,000...

December 28, 2020
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28Dec

Nigeria. Workers withdrew N2.18bn pension savings in Q3 – PenCom

About 1,286 workers under the Contributory Pension Scheme withdrew N2.18bn from the voluntary contributions in their Retirement Savings Accounts with their Pension Fund Administrators in the third quarter. The National Pension Commission disclosed this in its 2020 third quarter report. “During the quarter under review, the commission granted approval for withdrawal of the sum of N2.18bn from the voluntary contribution accounts of 1,286 contributors,” the report stated. The guidelines on voluntary contribution under the CPS states that the main...

December 28, 2020
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24Dec

US. Sustainability movements with staying power

It took the coronavirus pandemic and the death of George Floyd to convince Americans that racial inequality is a part of every facet of our economy. The awakening lifted several sustainability movements that will carry into 2021. Corporate America slowly is making progress on diversity. Environmental justice advocates have gained a foothold in Washington politics at the highest levels, underscored by President-elect Joe Biden’s Cabinet nominees. Wall Street had its own epiphany. Asset managers, insurers, pension funds and foundations...

December 24, 2020
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24Dec

Milliman: November sees decline in PRT premiums

Pension risk transfer premiums fell in November due to decreases in both discount rates and annuity purchase rates, a Milliman study said. The estimated buyout cost as a percentage of accounting liabilities (accumulated benefit obligation) dropped to 101.8% as of Nov. 30, from 102.9% a month earlier. The change was the result of average annuity purchase rates decreasing by 9 basis points, according to Milliman's latest pension buyout index study. Average accounting discount rates dropped 20 basis points in November....

December 24, 2020
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23Dec

OECD warns against using pension assets for ‘pet projects’

The OECD has warned governments against tapping into private pension assets for “pet projects” as nations look to retirement scheme cash to help drive the post Covid-19 economic recovery. Read also ESMA advises fresh postponement of pension fund central clearing duty Trustees of pension schemes in the UK have a duty to act in the best interests of members, but in spite of their investment freedoms, their portfolios predominately invest in equities and bonds. Read also US. Workers Tap Retirement...

December 23, 2020
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23Dec

Personal data leak in one of Britain’s largest pension providers

Workplace pension provider NOW: Pensions has emailed a number of UK customers to warn about a data leakage caused by contractor error. The email, seen by this publication, claims a service provider "unintentionally" posted user data to an unnamed "public software forum". These records include biographical data (names, email addresses, and dates of birth) as well as National Insurance numbers. According to the pension provider, the data was obtained by "a small number" of third parties. NOW: Pensions said...

December 23, 2020
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23Dec

Four Italian pension funds unite for major push into private debt

Four Italian pension funds have combined their efforts to find an alternative investment manager to oversee mandates related to private debt. The funds – Fondo Gomma Plastica, Fopen, Pegaso and Previmoda – have a total of €195m in commitments, which will result in a core strategy or unitranche corporate direct lending, with other strategies being added residually. The group said the tender, known as the Zefiro Project, will focus mainly on the European Economic Area with particular attention on...

December 23, 2020
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