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Philip neyt version  16 jun
 

Philip neyt version 16 jun

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    Philip neyt version  16 jun Philip neyt version 16 jun Presentation Transcript

    • New York, 23 June 2011Pan European Pension Funds, Now A RealityBelgian Economic Mission
    • 2
      Agenda
      Opening Remarks
      • Bob Kelly, Chairman and CEO BNY Mellon
      • H.E. Steven Vanackere, Deputy Prime Minister and Minister of Foreign Affairs and Institutional Reforms
      Speakers
      Philip Neyt, Chairman Belgian Pension Fund Association
      Convergence in European Pension Markets
      Jean Paul Servais, Chairman Financial Services and Markets Authority (FSMA)
      The Framework of Belgium’s New Dedicated Pan European Pension Vehicle
      Leonardo Sforza, Head Research Europe and EU Affairs, Aon Hewitt
      From Legislative Change to Business Practice: What Companies Can Gain
      HenkBecquaert, Member of the Board of Directors FSMA
      Thierry Verkest, Executive Director, Belgium and Luxembourg, Aon Hewitt
      Case Studies
    • 3
      Opening Remarks
      Bob Kelly
      Chairman and CEO BNY Mellon
    • 4
      Opening Remarks
      H.E. Steven Vanackere
      Deputy Prime Minister and Minister of Foreign Affairs and Institutional Reforms
    • 5
      Convergence in European Pension Markets
      What are the main drivers to merge pension funds into
      a single Pan European Pension Fund?
      Philip Neyt, Chairman Belgian Pension Fund Association
    • PRESSURE ON EU PENSION SYSTEMS
      EU Citizens’ feelings about future pensions (Eurobarometer 2010)
      Pension will not change
      Lower pension benefits
      27%
      27%
      73%
      26%
      20%
      Pension will change
      Save more
      Retire later
      6
    • PRESSURE ON EU PENSION SYSTEMS
      EU Citizens’ feelings about future pensions (Eurobarometer 2010)
      Pension wil be adequate
      53%
      47%
      Fairly or very worried of pension income
      7
    • PRESSURE ON EU PENSION SYSTEMS
      Remedies
      ADEQUACY OF STATE PENSIONS= average state pension compared to average wage
      AFFORDABILITY AND SUSTAINABILITY OF STATE PENSION= difference life expectancy and average exit age from labor market
      OCCUPATIONAL PENSIONS: CLOSING THE GAP?= Assets/Liabilities ratio
      Need of occupationalpensions
      EU = 42%
      EU = 17 Yrs
      Work longer, Later/flexible Retirement
      Annual Growth Rate (Liabilities-Assets) 2000-2010: 3%
      More gripon pension (funding) risk (f.ex.Pan-European pension fund ….)
      8
    • Pension risk at the corporate agenda
      “Since 2009 pensions belong to the top 10 concerns of CFO’s” (CFO.com)
      “Deficit in US States’ employee retirement funds grows to$ 1.3 trillion of 11.000 $ for each American” (Pew Center, 4/2011)
      “FTSE 350 companies face a pension deficit of £177 bn or 78% of their earnings” (Hymans & Robertson, 3/2010)
      “One third of FTSE100 companies can now not pay off deficits in any realistic timeframe from discretionary cash flow” (KPMG, 2010)
      “A pension promise can be easy to make but expensive to keep. The immediate cash cost is only part of the problem; the longer-term calculation also involves the value of future pension promises. (The Economist, 4/2011)”
      9
    • Multinational Pension Asset Pooling
      Multinational Pension Fund Pooling
      Company MNC
      UK Pension Plans
      Company MNC
      GermanPension Plans
      Company MNC
      FrenchPension Plans
      Company MNC
      GermanPension Fund
      Company MNC
      FrenchPension Fund
      Company MNC
      UK Pension Fund
      PooledAssetVehicle
      Single Pension Fund Entity
      Manager A
      Manager B
      Manager C
      Investments
      10
    • What drives a multinational to pool their pension funds?
      Reduced operational Risks(More grip and control)
      Simplified & centralized oversight
      Enhanced risk assessment, consistent risk mitigation
      Integrated global pension risk control
      Unifiedgovernance
      Consistent, central reporting/control
      Efficiency gains(economies of scale)
      • Uniformity facilitates workforce mobility
      • Pooling of “know how” (deeper expertise)
      • Leaner admin and fewer providers and interfaces
      • Eases m&a transactions
      Cost savings(single European Entity)
      • Funding flexibility / predictable funding
      • Tax optimization
      • Lower regulatory burden (single supervisor)
      • Solidarity between subsidiaries or ring-fencing
      • Better cost transparency and lower operating costs
      11
    • 12
      The Framework of Belgium’s New Dedicated Pan European Pension Vehicle
      Jean Paul Servais, Chairman Financial Services and Markets Authority (FSMA)
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      13
    • 14
      From Legislative Change to Business Practice: What Companies Can Gain
      Leonardo Sforza, Head Research Europe and EU Affairs, Aon Hewitt
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      15
    • 16
      Case Studies
      HenkBecquaert, Member of the Board of Directors FSMA
      Thierry Verkest, Executive Director, Belgium and Luxembourg, Aon Hewitt
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      17