July 2019

31Jul

The Crisis at South Africa’s $150 Billion State-Owned Fund Manager

Africa’s largest fund manager used to be a success story. Owned by the South African state, the Public Investment Corp. runs money for public institutions including the government-worker pension fund covering more than 1 million people. It increased its assets under management sixfold in 15 years, to about $150 billion. It's a major player in the Johannesburg stock market, and has wielded its power to curb executive pay at companies, make or break takeovers, and drive the government agenda...

July 31, 2019
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31Jul

UK. Contingent charging ban could cost advisers £445m

The financial regulator estimates the advice market will see its revenue drop by as much as £445m a year as a result of the ban on contingent charging. According to the regulator's own calculations, the ban will cost advisers between £360m – £445m a year in lost revenue as a result of a drop in demand for and a lower cost of pension transfer advice. This is alongside an estimated cost of between £399m - £598m in...

July 31, 2019
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30Jul

The world’s largest pension may be hedging euro and USD risk

Japan's $1.5 trillion public pension fund has begun to put on hedges to protect against USD and EUR declines, according to a Nikkei report published yesterday.The GPIF "has begun a transaction to avoid (hedge) losses associated with fluctuations in foreign exchange rates through fund management with foreign bonds. The target is US dollar and euro denominated bonds, and the balance at the end of March is approximately 1,300 billion yen," the report says. A hedge of that size will be swallowed...

July 30, 2019
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30Jul

US. DOL Releases Final Rule on ‘Association Retirement Plans’

The Department of Labor (DOL) has issued a final rule to help more employers offer retirement savings benefits through association retirement plans (ARPs). The rule, which will go into effect on September 30, will permit employers to connect with associations of employers in a city, county, state, or a multi-state metropolitan area, or in a particular industry nationwide to provide retirement plans for their employees. The DOL says the rule will allow small and midsized plan sponsors to offer competitive...

July 30, 2019
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30Jul

UK. FCA bans contingent charging in new pension advice rules

The FCA has outlined a ban on contingent charging for pension transfer advice as part of a new package of proposals. The regulator says the ban will help to "protect customers from the conflicts of interest which arise where a financial adviser only gets paid if a transfer goes In a statement, the FCA said: "We have carefully considered the available evidence on the impact of banning contingent charging, including how we can maintain access to advice for those groups of consumers...

July 30, 2019
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30Jul

India’s ageing crisis needs attention

So much has been said and written about the “demographic dividend” of India’s large young population that we have collectively failed to take note of a looming ageing crisis and its potential consequences. As our largely "under 35” population ages, the strength of what has been touted as India’s demographic dividend would gradually turn into a disadvantage over the next two decades. According to a 2017 report by the United Nations Population Fund (UNFPA), around 12.5% of India’s...

July 30, 2019
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30Jul

Make It Last: Fintech Firm Solves Number One Retirement Fear—Outliving Your Money

Ken Henderson, a traveling Pickleball pro, has taped out two 22-by-40-foot courts on an East Harlem gym floor. Today, instead of the usual Florida retirees, he’s teaching a crew of youngish engineers, Web designers and financial planners who have taken the subway up from the Chelsea offices of their fintech startup to play the paddle sport many Baby Boomers favor because it requires less running than tennis and is easier on aging joints. One of the older players today...

July 30, 2019
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29Jul

Zimbabwe tourism minister charged with corruption over pension fund

Zimbabwean Tourism Minister Prisca Mupfumira was charged in court on Friday with corruption involving $95 million from the state pension fund after questioning by the newly formed Zimbabwe Anti-Corruption Commission (ZACC). Mupfumira is the first senior government official to be interrogated by the commission, which was appointed by President Emmerson Mnangagwa last week after he promised tough action against graft. The prosecution laid out charges ranging from alleged abuse of state pension fund money to finance Mupfumira’s political campaigning to...

July 29, 2019
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29Jul

UK: PLSA Launches ESG And Stewardship Guidance

The PLSA published a new guide to help pension funds comply with the new ESG requirements coming into force from 1 October 2019, and support them in achieving good practice into the future. The new ESG requirements stem from a new regulation that was initially proposed by the Department for Work and Pensions in September 2018. The regulations implement the Law Commission's proposals to clarify pension scheme trustees' fiduciary duties in statute and will require pension schemes to have...

July 29, 2019
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29Jul

Jamaica. Imminent pension plan reforms will allow them to invest in a wider range of assets

Minister of Finance and the Public Service Dr Nigel Clarke moved amendments to the Pensions (Superannuation Funds & Retirement Schemes) (Investment) (Amendment) Regulations 2019, which were passed by the House of Representatives. These amendments will broaden the range of permissible assets in which pension plans can invest, and strengthen the legislative framework with respect to safeguarding the assets of pension plans. Giving his rationale for the change, Clarke observed “Mr Speaker, as we move into a new regime that's...

July 29, 2019
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