State Street Corp., the largest money manager for institutions, may have to pay more than the $625 million it set aside for damages from lawsuits over losses from subprime-mortgage investments made for pension funds.
International
Mikrofinanz-Fonds: Mit Entwicklungshilfe verdienen
Weltweit haben rund 1500 Mikrofinanz-Institute an Handwerker, Schneiderinnen oder Bauern 25 Milliarden Dollar verliehen. Vier Milliarden Dollar kommen von privaten Investoren. 2015 sollen es, so eine Studie der Deutschen Bank, 20 Milliarden sein. Die Pensionskasse des niederländischen Gesundheitswesens etwa will bis zum Jahr 2010 rund 200 Millionen Euro in Mikrofinanz-Anlagen investieren. Der auf Mikrofinanz spezialisierte Vermögensverwalter Responsability aus Zürich sammelt derzeit zehn Millionen Euro Anlegergeld » pro Monat ein. Deutsche Anleger können zurzeit in eine Handvoll Luxemburger Investmentfonds investieren.
Mikrofinanz-Fonds: Mit Entwicklungshilfe verdienen – WirtschaftsWoche
L.A. Times: CalPERS should maintain its activism
Since 1985, CalPERS has pushed the envelope of corporate governance initiatives and socially targeted investing. After the Los Angeles riots in 1992, for instance, CalPERS launched a $375-million initiative aimed at rehabilitation and development in California’s major urban areas. By 2005, the effort reached $1.2 billion, with investments in single-family homes as well as the mixed-use and industrial real estate. According to a Harvard Law School study, the return on investment during that period was over 22%. The study concluded that the investments «paid off handsomely for the fund, its beneficiaries and communities across the state.»
CalPERS should maintain its activism – Los Angeles Times
NYT: Entitled to What?
Virtually unnoticed during the primary season, the baby boom generation turned 62 this year and began to draw Social Security benefits. This heralded a milestone in America’s aging, and depending on which of the candidates you ask, it spells a budgetary straitjacket or possibly a looming social crisis. Over the next generation, the population of seniors will practically double, to 72 million. With more people retiring and a smaller share of people working, the strains on Social Security and especially Medicare will become evident.
Roger Lowenstein – Entitled to What? – Baby Boomers – Retirement
US: Market Turmoil Has Taken a Toll on Big Pension Funds
America’s biggest pension funds lost ground in the first quarter and are likely to require larger contributions from their corporate sponsors this year, joining the ranks of homeowners, lenders and others hurt by the recent turmoil in the financial markets. At the same time, though, some of America’s biggest companies have begun taking steps to shield their pension funds from market volatility by moving out of stocks. Such a step has long been predicted by economists, but was shunned until now by the vast majority of pension investment managers.
Market Turmoil Has Taken – New York Times
US: Large funds lead the way
Large pension funds lead the way in reacting to market and accounting changes, according to research from Greenwich Associates.
A Greenwich survey found whilst funding ratios for all sizes of funds had improved in recent times, larger pension schemes were quicker to adapt to fluctuations in the world economy and liability management.
Chris McNickle, consultant, Greenwich Associates, said: “Rarely in the course of our global pension research have we come upon such a dramatic difference in strategy between groups of funds operating in the same market.”
The survey found, despite producing good returns over the past two years, 40% of corporate funds with over $5bn in assets and a third of public funds of the same size said they planned to significantly change their asset allocation over the next three years. Only 8% of corporate funds with less than $500m in assets said they would do the same.
Global Pensions
Best practice essential for hedge funds
Hedge funds will have to comply with best practice standards to win institutional mandates over the next three years, according to a KMPG survey of the UK’s largest pension funds. Over 50% of funds said it was imperative managers complied with best practice standards with 80% of funds currently favouring managers which complied.
Global Pensions
Spiegel: Letzte Rentnergeneration mit auskömmlichen Renten
Die Altersarmut in Ostdeutschland wird massiv zunehmen. Diesen Schluss ziehen zwei ostdeutsche SPD-Minister in einer Analyse. Der DGB (Deutscher Gewerkschaftsbund) sieht diese Entwicklung für ganz Deutschland voraus und warnt vor einem Heer verarmter Rentner. DGB-Chef Michael Sommer sagte der «Bild»-Zeitung, derzeit lebe «die letzte Rentner-Generation, in der die allermeisten noch ein auskömmliches Einkommen haben». Das werde schon in wenigen Jahren anders sein.
Während von 1942 bis 1946 geborene Männer noch im Schnitt 967 Euro erhielten, würde die Durchschnittsrente der in den Jahren 1957 bis 1961 geborenen bei 820 Euro liegen. Für Frauen nennt die Analyse einen Rückgang von 820 auf 690 Euro. «Wir werden spätestens in 15 Jahren Millionen Rentner haben, die – wenn nichts passiert – von Sozialhilfe leben müssen», sagte Sommer. Das Thema Altersarmut werde völlig unterschätzt.
Politik – SPIEGEL ONLINE – Nachrichten
UK: Rule change will plunge pension funds into the red
Figures showing a big surplus in Britain’s largest occupational retirement schemes are misleading and will give staff false hope that employers will retain final-salary plans beyond the next few years, according to a firm of pension consultants. Proposed changes to accounting rules and increases in life expectancy would transform the current surplus in excess of £20bn registered by leading companies into a funding shortfall of more than £120bn, said Redington Partners.
Rule change | Money | The Guardian
Pension funds ditched UK shares in 2007
Pension fund investment in UK equities fell to a record low in 2007, according to research by BNY Mellon Asset Servicing. Their weighting to these assets fell to 28.7 percent from 34.4 percent in 2006, as the FTSE 100 share index. Their allocation to global equities fell to 55.1 percent, from 62.7 percent in 2006, an eighth consecutive annual fall.
Pension funds moved their money out of volatile equities and into relatively safer bonds and index-linked investments, pushing their overall allocation to UK bonds above UK equities for the first time, BNY Mellon said. The overall weighting of bonds in pension funds‘ asset portfolios rose to 27.6 percent, from 23.9 percent in 2006. Their allocation to alternative investments, such as hedge funds and private equity, rose to 1.6 percent from 0.8 percent.
Pension funds ditched UK shares in 2007 | News | Reuters
Bear Stearns / UBS: Don’t Paint Nest Eggs in Company Colors
By helping Bear Stearns avert a potential bankruptcy, the federal government essentially declared the venerable investment bank too important to fail. Over the years, many of the firm’s employees clearly felt the same way: collectively, they accumulated one-third of the company’s stock. Even under a revised rescue plan, in which JPMorgan Chase is offering $10 a share to buy Bear Stearns, the value of the company’s stock owned by Bear employees is now worth just a tenth what it was in December. For many of those employees, that decline is a personal catastrophe: most of their wealth is gone.
Die UBS hat ihre Angestellten stets ermutigt, in UBS-Aktien zu investieren. Die Hälfte der Mitarbeiter hält insgesamt 7% an der Bank und musste durch den Kurssturz über 10 Mrd. Fr. Verluste einstecken. (NZZ)
Don’t Paint Nest Eggs in Company Colors – New York Times / NZZ
Retraites: ce que les Français sont prêts à accepter
Jusqu’où les Français sont-ils prêts à aller pour régler la question des retraites? Un sondage Ifop apporte une réponse: seulement 44% sont favorables à un allongement de la durée de cotisation; ils ne sont que 38% à être favorables à un recul de l’âge du départ à la retraite au-delà de 60 ans. En revanche, une large majorité des personnes interrogées (67%) est favorable au prélèvement de cotisations sociales sur les stocks options. Et 57% des Français, selon ce sondage Ifop, seraient prêts à ce que l’on complète le système de retraites par répartition au moyen de fonds de pension.
ouest-france.fr – Retraites:
Watson Wyatt : Retirement Assets Grew Substantially in Last 10 Years, But Face a Challenging 2008
Growth rates for retirement assets began slowing worldwide in 2007. In the 11 countries with the largest workplace retirement systems, the estimated growth rate for retirement assets was only 2 percent in 2007. This was a significant drop from the 10.5 percent growth rate for the five-year period ending in 2007 and from the 7.4 percent per annum growth of the last 10 years. U.S. short-term returns were better with retirement assets growing 8.3 percent in 2007 and 10.9 percent over five years. U.S. retirement assets make up an estimated 60 percent of assets in the 11 countries, although the U.S. share has been declining slowly.
Watson Wyatt’s Global Pension Assets Study analyzes retirement assets in the United States, Australia, Canada, France, Germany, Hong Kong, Ireland, Japan, Netherlands, Switzerland and the United Kingdom.
Watson Wyatt Europe – Ideas & Research | Research Reports
US pension funds seek emergency block of Bear deal
Two Michigan pension funds are seeking emergency court action to stop the planned takeover of Bear Stearns Cos Inc (BSC.N: Quote, Profile, Research) by JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) from moving forward, according to court papers. Lawyers for the pension funds said that JPMorgan’s $10-a-share revised offer for the company — up from $2 a share initially — was «grossly inadequate.» In the court papers, the funds‘ lawyers said that the deal provisions also effectively block any potential third-party bidder from making an offer.
US pension funds seek emergency block of Bear deal | Reuters
UK: Pensions hit by market woes
Pension funds have taken a sharp dive after months of turmoil in the stock markets. Plunging share prices have wiped 8% off the average scheme over the past six months, with some savers suffering falls of up to 30%. Many investors who have a long way to go to retirement don’t need to be too concerned. Hopefully, by the time they retire the funds will have made up the loss.