September 2020

25Sep

UK. Scam warning signs found in half of post-Lockdown pension transfers

According to XPS, the pensions consultancy firm, in July and August of this year 51% of pension transfers, equating to twenty five million pounds in pension savings, were flagged as at risk of a pension scam. The number of transfers showing at least one red flag has dramatically increased during the COVID-19 pandemic. In 2016, only 13% of pensions’ transfers triggered a red flag. This figure rose to 33% at the end of June 2020 and then jumped considerably...

September 25, 2020
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24Sep

US. Pension Buyouts a Relative Bargain, Says Mercer

Now may be a good time for companies looking to de-risk their defined benefit (DB) pension plans to consider an annuity buyout, according to new data from consulting firm Mercer, which shows a hypothetical retiree buy-out transaction costs an estimated 97.7% of a plan’s accounting obligations. Mercer said the new data is a result of recent tweaking the company made to its US Pension Buyout Index, which tracks the relationship between the accounting liability for a defined benefit plan...

September 24, 2020
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24Sep

UK. Aon warns longevity risk has not gone away with COVID-19 deaths

Insurance and reinsurance broker and risk advisory Aon has warned today that re/insurers and pension funds need to avoid over-reacting to how inclusion of COVID-19 deaths changes recognised mortality models, saying that “longevity risk has not gone away.” Once excess deaths are added into the mortality models for the United Kingdom it may produce an unrealistic fall in life expectancy, Aon warns. Insurance and reinsurance companies, as well as pension schemes and funds, factor life expectancy into their calculations...

September 24, 2020
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22Sep

Beijing Taking Measures To Address China’s Upcoming Retirement Savings Deficit

China has been leveraging the domestic interest rate as an integral part of its monetary policy since the opening up of the bond market in 2019, increasingly allowing international investors to hold municipal bonds. Read also Canada. OSFI launches discussion on tech risks to pensions, other federal financial institutions Further into its liberalization of the market, China also allowed foreign capital to play a part in its funds market from earlier this year. Read also Switzerland. Credit Suisse pension...

September 22, 2020
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21Sep

New pension law proposed for South Africa

The Democratic Alliance (DA) has called for comment on its proposed Private Member’s Bill (PMB) to amend the Pension Funds Act. Read also It’s too early to panic over plans for South African pensions: asset managers The bill aims to amend the current Pension Funds Act to enable pension fund members to access a percentage of their pension fund before retirement as a guarantee for a loan. Read also Ghana: Press highlights plight of pensioners, removal of 7,000 ‘ghost’ names...

September 21, 2020
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14Sep

S. Korea’s state pensions to face steep shortfall in 20 yrs: report

South Korea’s state-managed pension and insurance funds may dry up earlier than expected, suggesting the need of dramatic changes to cope with demographic trends and funding shortfalls in the foreseeable future, a government report projected. According to the fiscal outlook report for 2020-2060 by the Ministry of Economy and Finance, state-run National Pension Service, the world’s third largest pension fund, is estimated to return to a net loss by 2040 if conditions remain unchanged from now. The analysis projects...

September 14, 2020
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14Sep

UK. Credit downgrades present ‘serious challenges’ for pension schemes – AXA IM

A fall in the average credit quality of fixed income indices and increased competition for high-quality assets presents “serious challenges” for pension schemes, AXA Investment Managers (IM) has warned. Since the beginning of the Covid-19 pandemic, rating agencies have down graded over £778bn of corporate issues across global indices, leaving high quality assets in “short supply” during a period of rising demand. AXA IM Buy and Maintain credit team portfolio manager, Simon Baxter, stated that the concentration in high grade...

September 14, 2020
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14Sep

Exploring the health-wealth connection

The song “God Part II” on the album “Rattle and Hum” by U2 has the lyrics: “The rich get healthy, while the sick stay poor.” Bono sung those words in 1988. Since then, a number of researchers have tackled what exactly is the link between wealth and health, and why. At first glance, one would expect a simple explanation: people with more money live longer. Clearly such a relationship cannot be strictly linear, as people don’t fall dead if...

September 14, 2020
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09Sep

US. What has COVID-19 done to our retirement savings?

COVID-19 has disrupted life as we knew it, upending our daily lives, threatening the health of many, and exacerbating the financial stress already facing many families. The short-term impacts have been substantial and have received considerable attention, but we should not lose sight of the potential for long-term financial consequences, especially on retirement security. Read also US. DOL´S mixed message for plan sponsors Short-term relief, long-term consequences As millions of Americans found themselves out of work and many small businesses...

September 9, 2020
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09Sep

Using behavioral insights to make the most of emergency social protection cash transfers

In response to the COVID-19 pandemic, countries across the globe have been adapting social assistance policies to support their populations. In fact, since March 2020, 139 countries and territories have planned, implemented, or adapted cash transfers to support their citizens. Cash transfers specifically make up about half of the social protection programs implemented to address the pandemic. Now more than ever, it’s crucial that such programs are designed to maximize impacts. Behavioral insights can be mobilized as a cost-effective...

September 9, 2020
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