November 2021
17Nov

US. Major Pension Fund Adds Leverage As Assets Push Half A Trillion

The CalPERS Pension Fund, has resolved to change its investment allocation next year. The new asset mix reduces public equity exposure adding exposure to private equity, fixed income and real assets. However, the more interesting angle is that total exposure for the fund is now 105% rather than 100%. That is to say, the fund will borrow to fund its investment portfolio. Read also US. For a workforce in flux, retirement plans and benefit options may be increasingly important Leverage Though the fund...

November 17, 2021
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17Nov

Milliman: Pension risk transfer premiums more competitive

Pension risk transfer premiums became more competitive in October as deal volume is set to increase in the fourth quarter, a study by Milliman showed. The estimated buyout cost as a percentage of accounting liabilities (accumulated benefit obligation) was 102.5% as of Oct. 31, down from 102.7% as of Sept. 30, according to a report of the Milliman Pension Buyout index. September's premium was up significantly from 102.2% as of Aug. 31. Meanwhile, the average annuity purchase rates among the most competitive rates...

November 17, 2021
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13Nov

Fiduciary Duty, Social Conscience, and ESG Investing by a Trustee

By Max M. Schanzenbach, Robert H. Sitkoff This chapter, prepared for the 2021 Annual Heckerling Institute on Estate Planning, examines the law and economics of environmental, social, and governance (ESG) investing by a trustee. Trustees of pensions, charities, and personal trusts invest tens of trillions of dollars of other people’s money subject to a sacred trust known in the law as fiduciary duty. Recently, these trustees have come under increasing pressure to use ESG factors in making investment decisions. ESG investing...

November 13, 2021
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12Nov

U.S. Steel to Transfer About $284 Million of Pension Obligations

United States Steel Corp. said it will transfer about $284 million of pension plan obligations via a purchase of annuity contracts from two units of Legal & General Group PLC. The purchase results in the transfer of administrative and benefit-paying responsibilities for about 17,800 U.S. retirees and beneficiaries. The steel company said "this transaction is yet another meaningful step in strengthening the company's balance sheet and further de-risking our pension plan, a plan that remains more than 100% funded and is...

November 12, 2021
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12Nov

Build a Solid Risk Management Road Map

“The COVID pandemic itself didn't fundamentally change how risk management for pension plans should be addressed, but it did confirm why it’s important to have a sound risk management framework,” said Francois Pellerin, multi asset-class strategist at Fidelity Investments. “Plan sponsors who adopted the risk management best practices we’ve been preaching were able to adapt to market changes faster and emerge from the crisis in better shape than those who didn’t adopt those practices,” he said, speaking at Pensions...

November 12, 2021
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09Nov

Nigeria. Pension Funds downsize investments in states by 36%

Pension Funds Administrators (PFAs) are now downsizing their investments in state governments’ bonds amidst fears that the states’ financial stability and their commitment to pensions are questionable. Financial Vanguard’s findings in the data from the National Pension Commission, (PenCom) shows that the PFAs’ investments in state government securities fell by a huge 36 percent to N97.89 billion in the first half of 2021 (H1’21) from N152.93 billion in the corresponding period in 2020 (H1’20). But the PFAs’ interest in Federal Government...

November 9, 2021
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08Nov

Kenya. Pension scheme providers urged to adopt new regulations

The government has asked pension scheme providers in the country to adhere to the new pension regulations. The new regulations came into force after the adoption of the Pensions Amendment Bill of 2020. The Bill allows subscribers of pensions schemes to access up to 40 per cent of their pension to own houses. Previously, upon discharge, employees were entitled to their own contributions, 50 per cent of their employer’s contributions, and any investment income that accrued after those contributions. Furthermore, the regulations...

November 8, 2021
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04Nov

Germany’s $400 Billion Pension Fund Eyes Capital Markets Boost

Germany’s future government plans to let the country’s pension system invest in the capital markets for the first time in what would be a small revolution in how Europe’s largest economy manages money for its growing ranks of retirees. Negotiators for the Social Democrats, Greens and the market-oriented Free Democrats are seeking to hammer out details that would allow the $400 billion pension system to start investing some of its reserves into stocks and bonds, which would bring it more...

November 4, 2021
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03Nov

Pension funds commit $130 billion to fight climate change at the COP26 summit

Nordic and British pension funds on Tuesday committed to invest $130 billion by 2030 to fight climate change, and report annually on the progress of their green investments. Denmark said $75 billion of the funds were new commitments. The pledge, launched at the COP26 climate summit in Glasgow, Scotland, included asset owners in Sweden, Norway, Finland, Denmark, Iceland, the Faroe Islands and the United Kingdom, plus a fund from Greenland. "Green transition requires massive investments. Governments have to do their part...

November 3, 2021
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03Nov

Knowing the difference between ethical, responsible and impact investing

Climate change awareness and environmental concerns have never been more important, and over the past few years these issues have been spoken about in abundance when describing financial investments. Three phrases in particular have been commonly used to describe investment products and strategies, but there is still confusion as to their exact meaning. Mike Appleby, investment manager on the Liontrust Sustainable Investment team, outlined the difference between ethical investing, responsible practices and impact investing. “Ethical investing looks to avoid controversial industries such...

November 3, 2021
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