October 2022
06Oct

UK. LDI Fallout Will Spur Pension Funds to Seek Life Sector Arrangements

The sudden need for pension funds to put up large amounts of extra collateral due to tumbling gilt prices will lead more UK defined-benefit pension funds to favour pension risk transfer deals with life insurers over liability-driven investment (LDI) arrangements with asset managers, Fitch Ratings says. The rapid drop in gilt prices following the UK’s ‘mini-Budget’ on 23 September led to a sharp increase in collateral requirements from many LDI funds as derivative contracts protecting against lower interest rates moved...

October 6, 2022
News, ,
Read more...

September 2022
30Sep

Pension Insurance Corporation Group Limited. Annual Report and Accounts 2021

By Pension Insurance Corporation Group Limited PIC is a specialist insurer which has become a leader in the UK pension risk transfer market by focusing on our purpose: to pay the pensions of our current and future policyholders. We aim to balance the interests of all our stakeholders – policyholders, employees, shareholders, regulators and others – with excellence in customer service at the heart of what we do. Source @PensionCorporation 265 views

September 30, 2022
Books, Books, Pension Management, , ,
Read more...
29Sep

With Interest Rates Rising, Companies Look to Unload Pension Liabilities

The funding status of defined-benefit pension plans has been lifted by rising interest rates, which are expected to increase further Rising interest rates are boosting corporate pension plans, providing finance chiefs with an option to lighten their companies’ balance sheets and transfer obligations to insurers. The U.S. central bank has raised interest rates five times this year as it battles persistent high inflation, including last week when it opted for the third consecutive 0.75-point interest-rate increase and indicated further rate action. When...

September 29, 2022
News, , ,
Read more...

August 2022
29Aug

UK. Andy Bell: Common sense failure risks good work on pension transfers

By  Andy Bell In December last year I wrote in Money Marketing that new regulations designed to protect savers from pension scams would only work properly if common sense was applied by schemes administering transfers. Sadly, in certain parts of the industry, it appears ‘common sense’ is an alien concept, and it looks increasingly likely the rules will need to be revisited to ensure legitimate transfers aren’t slowed to a crawl or blocked altogether. Pension transfer scams As a reminder, this saga started...

August 29, 2022
News, OP Ed, ,
Read more...
26Aug

GOP Fury Over ESG Triggers Backlash With US Pensions at Risk

Investment professionals are warning that a Republican campaign seeking to wipe ESG off the financial map puts at risk the savings of ordinary Americans caught in the political crossfire. Read also United States: ESG And Political Climate Changes Environmental, social and governance investing is now under attack in the world's largest economy. Florida Governor Ron DeSantis this week banned state pension funds from screening for ESG risks. Texas is seeking to isolate financial firms it says are hostile toward the fossil-fuel...

August 26, 2022
News, , , ,
Read more...
26Aug

UK. Just 6% of pension transfers not flagged as scams

A staggering 94% of pension transfer cases reviewed by XPS Group’s Scam Protection Service were registered as having one or more scam warning signs in July 2022 – a small fall from 97% in June 2022. The firm said this is the second month in a row where the rate has been in excess of 90% of cases, with the overseas investment amber flag being the most common warning identified. However, pension transfer activity seems to be on the rise as...

August 26, 2022
News, , ,
Read more...
22Aug

Planets aligning for U.S. pension funds to offload their liability risk

U.S. corporate pension plans have reached a sweet spot in their derisking journeys that will enable them to pull the trigger on pension risk transfer transactions, including plan terminations. Their funding levels have risen primarily due to rising interest rates that are lowering pension liabilities even as plan assets have fallen due to the challenging return environment that has characterized the first half of 2022. "For corporate pension plans, this what they've been waiting for, for years," said Michael Moran, New...

August 22, 2022
News, , ,
Read more...
17Aug

UK. Transfer volumes could hit £600bn as insurers post strong results

A host of insurers have revealed their first-half 2022 results that show a booming trade in risk transfers, which, by some projections, could hit £600bn over the next decade — though there are fears about a capacity crunch in the sector. Read more Older people face losing €1,532 in spending power by end of year Of those that have released their results so far, Aviva saw bulk annuity sales increase by 15 per cent, rising to £1.9bn, which compares with £1.6bn...

August 17, 2022
News, , ,
Read more...

July 2022
28Jul

Trust and Retirement Preparedness: Evidence from Singapore

By Benedict S. Koh, Olivia S. Mitchell & Joelle H. Fong Trust is an essential component of the financial system, and distrust can undermine saving and economic growth. Accordingly, prior research has shown that survey responses to a question about ‘trust in people’ are associated with household willingness to invest in the stock market. Nevertheless, little is known about how trust shapes economic behaviors predictive of retirement preparedness. Our study draws on the Singapore Life Panel (SLP®), a high-frequency internet...

July 28, 2022
Articles, Investing, Savings, , ,
Read more...
26Jul

US. Milliman: Pension risk transfer premiums increase slightly in June

Estimated average pension risk transfer premiums rose slightly in June, but the average rate among the most competitive bidding processes fell by 30 basis points, a study by Milliman showed. The estimated buyout cost as a percentage of accounting liabilities, or accumulated benefit obligations, was 103% as of June 30, up from 102.5% as of May 1, according to the Milliman Pension Buyout index. However, the average of the most competitive annuity purchase rates fell by 30 basis points to 98.3%...

July 26, 2022
News, , ,
Read more...