Philip neyt version 16 jun

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Philip neyt version 16 jun

  1. 1. New York, 23 June 2011Pan European Pension Funds, Now A RealityBelgian Economic Mission <br />
  2. 2. 2<br />Agenda<br />Opening Remarks<br /><ul><li>Bob Kelly, Chairman and CEO BNY Mellon
  3. 3. H.E. Steven Vanackere, Deputy Prime Minister and Minister of Foreign Affairs and Institutional Reforms</li></ul>Speakers<br />Philip Neyt, Chairman Belgian Pension Fund Association<br />Convergence in European Pension Markets<br />Jean Paul Servais, Chairman Financial Services and Markets Authority (FSMA)<br />The Framework of Belgium’s New Dedicated Pan European Pension Vehicle<br />Leonardo Sforza, Head Research Europe and EU Affairs, Aon Hewitt<br />From Legislative Change to Business Practice: What Companies Can Gain<br />HenkBecquaert, Member of the Board of Directors FSMA<br />Thierry Verkest, Executive Director, Belgium and Luxembourg, Aon Hewitt<br />Case Studies<br />
  4. 4. 3<br />Opening Remarks<br />Bob Kelly<br />Chairman and CEO BNY Mellon<br />
  5. 5. 4<br />Opening Remarks<br />H.E. Steven Vanackere<br />Deputy Prime Minister and Minister of Foreign Affairs and Institutional Reforms<br />
  6. 6. 5<br />Convergence in European Pension Markets<br />What are the main drivers to merge pension funds into <br />a single Pan European Pension Fund?<br />Philip Neyt, Chairman Belgian Pension Fund Association<br />
  7. 7. PRESSURE ON EU PENSION SYSTEMS<br />EU Citizens’ feelings about future pensions (Eurobarometer 2010)<br />Pension will not change<br />Lower pension benefits<br />27%<br />27%<br />73%<br />26%<br />20%<br />Pension will change<br />Save more<br />Retire later<br />6<br />
  8. 8. PRESSURE ON EU PENSION SYSTEMS<br />EU Citizens’ feelings about future pensions (Eurobarometer 2010)<br />Pension wil be adequate<br />53%<br />47%<br />Fairly or very worried of pension income<br />7<br />
  9. 9. PRESSURE ON EU PENSION SYSTEMS<br />Remedies<br />ADEQUACY OF STATE PENSIONS= average state pension compared to average wage<br />AFFORDABILITY AND SUSTAINABILITY OF STATE PENSION= difference life expectancy and average exit age from labor market<br />OCCUPATIONAL PENSIONS: CLOSING THE GAP?= Assets/Liabilities ratio<br />Need of occupationalpensions<br />EU = 42%<br />EU = 17 Yrs<br />Work longer, Later/flexible Retirement<br />Annual Growth Rate (Liabilities-Assets) 2000-2010: 3%<br />More gripon pension (funding) risk (f.ex.Pan-European pension fund ….)<br />8<br />
  10. 10. Pension risk at the corporate agenda<br />“Since 2009 pensions belong to the top 10 concerns of CFO’s” (CFO.com)<br />“Deficit in US States’ employee retirement funds grows to$ 1.3 trillion of 11.000 $ for each American” (Pew Center, 4/2011)<br />“FTSE 350 companies face a pension deficit of £177 bn or 78% of their earnings” (Hymans & Robertson, 3/2010)<br />“One third of FTSE100 companies can now not pay off deficits in any realistic timeframe from discretionary cash flow” (KPMG, 2010)<br />“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)”<br />9<br />
  11. 11. Multinational Pension Asset Pooling<br />Multinational Pension Fund Pooling<br />Company MNC<br />UK Pension Plans<br />Company MNC<br />GermanPension Plans<br />Company MNC<br />FrenchPension Plans<br />Company MNC<br />GermanPension Fund<br />Company MNC<br />FrenchPension Fund<br />Company MNC<br />UK Pension Fund<br />PooledAssetVehicle<br />Single Pension Fund Entity<br />Manager A<br />Manager B<br />Manager C<br />Investments<br />10<br />
  12. 12. What drives a multinational to pool their pension funds?<br />Reduced operational Risks(More grip and control)<br />Simplified & centralized oversight<br />Enhanced risk assessment, consistent risk mitigation<br />Integrated global pension risk control<br />Unifiedgovernance<br />Consistent, central reporting/control<br />Efficiency gains(economies of scale)<br /><ul><li>Uniformity facilitates workforce mobility
  13. 13. Pooling of “know how” (deeper expertise)
  14. 14. Leaner admin and fewer providers and interfaces
  15. 15. Eases m&a transactions</li></ul>Cost savings(single European Entity)<br /><ul><li>Funding flexibility / predictable funding
  16. 16. Tax optimization
  17. 17. Lower regulatory burden (single supervisor)
  18. 18. Solidarity between subsidiaries or ring-fencing
  19. 19. Better cost transparency and lower operating costs</li></ul>11<br />
  20. 20. 12<br />The Framework of Belgium’s New Dedicated Pan European Pension Vehicle<br />Jean Paul Servais, Chairman Financial Services and Markets Authority (FSMA)<br />
  21. 21. Type Title Here <br />Text line here<br />Text line here<br />Text line here<br />Text line here<br />Text line here<br />13<br />
  22. 22. 14<br />From Legislative Change to Business Practice: What Companies Can Gain<br />Leonardo Sforza, Head Research Europe and EU Affairs, Aon Hewitt<br />
  23. 23. Type Title Here <br />Text line here<br />Text line here<br />Text line here<br />Text line here<br />Text line here<br />15<br />
  24. 24. 16<br />Case Studies<br />HenkBecquaert, Member of the Board of Directors FSMA<br />Thierry Verkest, Executive Director, Belgium and Luxembourg, Aon Hewitt<br />
  25. 25. Type Title Here <br />Text line here<br />Text line here<br />Text line here<br />Text line here<br />Text line here<br />17<br />

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