Neue Bilanzierungsregeln für die firmeneigene Pensionskasse werden nach Prognose von Siemens Deutschland das Geschäftsergebnis um bis zu 700 Millionen Euro mindern. Frisches Geld will der Konzern aber nicht nachschießen – vorerst.
International
Longevity risk fuels search for solutions
Pension schemes are in trouble. Against a backdrop of dwindling returns, the only thing that appears to be going up is how long scheme members are likely to live and, therefore, require a pension. Regulators in some parts of the world are helping out scheme sponsors by relaxing rules on pension funding so employers are not under such pressure to make the additional contributions needed to close deficits.
But necessity, as they say, is the mother of invention and this could explain why the last few years have seen increasing ingenuity in the industry regarding longevity risk. “I would say that particularly over the last three or four years most schemes have improved the way in which they are looking at longevity risk,” says Andrew Gaches, longevity consultant with Club Vita, the longevity consultancy arm of Hymans Robertson. “This is in part due to lower discount rates, meaning longevity now has a larger financial impact,” Mr Gaches says.
Goldman Sachs Explains Why Pension Plans Are Such A Pain For Corporations
Corporate pension plans have gotten banged up in the wake of the financial crisis. And the current unfavorable investment environment has made it difficult for the plan managers to invest for the future.
"These challenges include low funded levels due primarily to low market interest rates, increasing contribution requirements and expense recognition for plan sponsors, and declining future return assumptions for plan assets," writes Michael Moran of Goldman Sachs Asset Management.
Norwegian Fund Fell 2.2% Last Quarter
Norway’s $620 billion sovereign wealth fund, Europe’s largest equity investor, saw its assets decline 2.2 percent last quarter as stocks fell on concern the euro area’s debt crisis would hamper a global recovery.
The Government Pension Fund Global lost 77 billion kroner ($13 billion) on its investments, as measured by a basket of currencies, it said in a statement. Equity investments slipped 4.6 percent, while the fund’s bonds returned 1.5 percent.
Massachusetts Sees 8% Pension Gains Shunned by Calpers
Massachusetts Treasurer Steven Grossman wants to reduce the assumed rate of return on the state’s $50 billion in pension-fund assets, currently at 8.25 percent and among the highest for U.S. public retirement plans.
Grossman said he’s gathering legislative support for a cut to 8 percent, with an option to go lower. That would put Massachusetts more in line with other states, yet the move would cost taxpayers and covered workers $1.7 billion to maintain funding commitments.
More than a third of 126 state and municipal pensions, including the California Public Employees’ Retirement System, the largest with $238.5 billion in assets, have cut investment assumptions since 2008 as returns have lagged behind historical averages, according to the Public Fund Survey. Wilshire Associates said this week that the median return for public systems was 1.15 percent for fiscal 2012 as the European debt crisis and a slowing global economy curbed equity gains.
GR: Blindtest
Trotz intensiver Kontrollen erschleichen sich weiterhin Griechen Zuschüsse und Pensionen. Neue Kontrollen sollen die Verhältnisse nun klären. Die Behörden können für jede zehnte Pension nicht sicher feststellen, ob sie rechtmäßig ist und an wen sie genau ausgezahlt wird, sagte der Chef der Behörde, die die Bücher der Pensionskassen prüft. "Etwa jede zehnte Pension kann nicht richtig verifiziert werden, an wen sie geht", sagte Charis Theocharis. Nach einer Verordnung des Arbeitsministeriums müssen alle Pensionskassen bis zum 17. August detaillierte Listen mit den Pensionen vorlegen, bei denen es Zweifel gibt.
Die Behörden nehmen ausserdem auch angeblich Blinde ins Visier. Kontrolleure haben auf der Ionischen Insel Zakynthos festgestellt, dass statt angeblich 700 Betroffenen tatsächlich nur 60 blind waren. Zu ähnlichen Ergebnisse kam es auch auf der Insel Chios im östlichen Mittelmeer.
Retirees Face Tough Choice on Pensions
More and more retirees could soon be facing the choice of accepting a pension buyout or collecting a monthly check, says Marilyn Capelli Dimitroff, a financial adviser in Bloomfield Hills, Mich.
Few companies still offer traditional, defined-benefit pension plans, but millions of retirees are still collecting pensions. Earlier this year, General Motors Co. gave 42,000 of its 118,000 salaried retirees the option of taking a one-time payment in lieu of a traditional pension, in a bid to reduce the company’s overall pension liabilities. That followed a similar offer by Ford Motor Co. to many of its former employees.
“This could well be the beginning of a trend for many companies,” says Ms. Dimitroff, president of Capelli Financial Services Inc.
UK: Plunging gilt yields send pension schemes in search for alternatives
UK pension funds are being urged to ditch their estimated £100bn investment in UK government debt, or gilts, after consultants branded the asset class unfit for purpose.
In a document sent to pension fund clients, consultant PwC questions whether gilts are fit for inclusion as a core portfolio component after £375bn worth of quantitative easing pushed yields to historic lows.Raj Mody, chief actuary at PwC, says: “There is an accepted myth that gilts are the best matching asset for UK pension liabilities but is that true during QE, which is distorting what gilts stand for?”
Following the most recent round of QE at the start of July, 10-year gilt yields fell to record lows of 1.4 per cent.
Given that UK pension deficits stand at £267bn according to June figures from the Pension Protection Fund, such low gilt yields may drive trustees to consider more derivative-based strategies that free up capital and promise the opportunity to deliver extra return.
Church of England risks vicars‘ pensions in hedge funds
The Church of England has poured £60m of vicars‘ pension investments into hedge funds run by some of the world’s richest people.
One of the funds is run by US billionaire Ray Dalio, while another is managed from a south London mews house by British multimillionaire David Harding. Disclosure that the church is risking vicar’s pensions in hedge funds prompted a call from within the CofE for the church’s pension board to scrutinise hedge fund remuneration policies.
NYT: Our Ridiculous Approach to Retirement
Seventy-five percent of Americans nearing retirement age in 2010 had less than $30,000 in their retirement accounts. The specter of downward mobility in retirement is a looming reality for both middle- and higher-income workers. Almost half of middle-class workers, 49 percent, will be poor or near poor in retirement, living on a food budget of about $5 a day.
To maintain living standards into old age we need roughly 20 times our annual income in financial wealth. If you earn $100,000 at retirement, you need about $2 million beyond what you will receive from Social Security. If you have an income-producing partner and a paid-off house, you need less. This number is startling in light of the stone-cold fact that most people aged 50 to 64 have nothing or next to nothing in retirement accounts and thus will rely solely on Social Security.
It is now more than 30 years since the 401(k)/Individual Retirement Account model appeared on the scene. This do-it-yourself pension system has failed. It has failed because it expects individuals without investment expertise to reap the same results as professional investors and money managers. What results would you expect if you were asked to pull your own teeth or do your own electrical wiring?
Although humans may be bad at some behaviors, we are good at others, including coming together and finding common solutions that protect all of us from risk. Surely we can find a way to help people save — adequately and with little risk — for their old age.
Verkauf der Pensionskasse Siemens Österreich
Siemens Österreich und die Valida-Holding haben sich vertraglich auf die Übernahme der Siemens Pensionskasse inklusive Beteiligungen durch die Valida geeinigt. Der Eigentumsübergang soll im Herbst erfolgen. Laut Valida zählte die Siemens Pensionskasse AG einschließlich der Siemens Mitarbeitervorsorgekasse AG per Jahresende 2011 mehr als 76.000 Begünstigte zu ihren Kunden und verzeichnete insgesamt ein verwaltetes Vermögen von aktuell über 845 Millionen Euro. Valida selbst habe 1,7 Millionen Begünstigte. Das Unternehmen weist ein gemanagtes Vermögen von mehr als 4,7 Milliarden Euro per Jahresende 2011 aus.
D: Betriebsrente ist in Gefahr
Die Altersvorsorge von 17 Millionen Deutschen ist bedroht: Die Pensionskassen können nur noch Anleihen mit niedrigen Zinsen aufnehmen. Der darauf folgende Anlagennotstand lässt die Renten schrumpfen, schreibt die FAZ. Das Problem, vor dem alle Versorgungswerke stehen, lässt sich an der Renditeentwicklung deutscher Bundesanleihen mit zehnjähriger Laufzeit ablesen: Warfen die Papiere im Jahr 2002 noch einen üppigen Ertrag von mehr als fünf Prozent ab, sind es heute gerade einmal 1,2 Prozent. Nach Abzug der Inflation machen Anleger mit Bundesanleihen derzeit sogar Verlust.
UK: Pension funds increase ETF usage
Large UK pension funds are making more use of exchange traded funds as confidence in their reliability rises, according industry experts. Since the extreme volatility caused by the euro crisis, it has been common for funds to use ETFs for short periods as overlays to existing holdings in emerging markets and high yield bonds.
Paul Trickett, head of global solutions group at Goldman Sachs Asset Management, said the rise was due to the growing variety of ETFs. “The granularity you can get is great, so you can pick a particular segment of the market and underweight or overweight that sector,” said Mr Trickett.
US: Private Pension Plans May Be Underfunded
After years of poor investment returns, the pension funds of the United States’ largest companies are further behind than they have ever been.
The companies in the Standard & Poor’s 500 collectively reported that at the end of their most recent fiscal years, their pension plans had obligations of $1.68 trillion and assets of just $1.32 trillion. The difference of $355 billion was the largest ever, S.& P. said in a report.
Of the 500 companies, 338 have defined-benefit pension plans, and only 18 are fully funded. Seven companies reported that their plans were underfunded by more than $10 billion, with the largest negative figure, $21.6 billion, reported by General Electric.
The other companies with more than $10 billion in underfunding were AT&T, Boeing, Exxon Mobil, Ford Motor, I.B.M. and Lockheed Martin. JPMorgan Chase had the largest amount of overfunding, $1.6 billion.
The main cause of the underfunding at many companies does not appear to be a failure to make contributions to the plans. Instead, it reflects the fact that investment markets have not performed well for a sustained period.
CalPERS returns 1% on investments
CalPERS announced it returned 1% on its investments for the 12 months ended June 30, below its own custom benchmark of 1.7%. The results contrast sharply with the 20.7% return the $229.8 billion California Public Employees’ Retirement System, Sacramento, earned in the year ended June 30, 2011.
CalPERS reported declines for the latest 12 months in public equity, -7.2%; forestland, -11%; and absolute return, -2%. The best-performing asset class was real estate, at 15.9% for the year ended March 31. Real estate lags the rest of the portfolio by three months. Fixed income was up 12.7%, followed by infrastructure, 8.4%; private equity, 5.4%; and liquidity, 4.6%. Private equity performance was also as of March 31.
According to the pension fund’s website, CalPERS’ asset allocation as of March 31 was 51% public equity, 17% fixed income, 14% private equity, 8% real estate, 3% each inflation assets and liquidity, 2% absolute return and 1% each forestland and infrastructure.