Industry views

01 Sep 2011

A Platform For Change

Publication: PensionsWorld
Author: Benjamin Reid, President

To effectively manage defined benefit liability, companies must have a better overall view of the key pension risks they face, explains Benjamin Reid PensionsFirst Analytics

Economic, market and regulatory forces continue to change the landscape for the defined benefit (DB) pensions industry. Pension sponsors are being forced to take greater notice of the impact that key risks - such as equity, infl ation, interest rate and longevity - can have upon their scheme's funding position and subsequently their company's balance sheet, cash flow and income statement.  Left unmanaged, DB pension risk leads to volatility and poses a serious threat to the financial viability of many sponsoring companies. For example, ten of the FTSE 100 now have pension liabilities greater than their market capitalisation.

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01 Dec 2010

Defined benefit pension plans: Towards better risk management

Publication: Journal of Corporate Treasury Management
Author: Benjamin Reid, CEO PensionsFirst Analytics

Economic, market and regulatory forces are changing the landscape for the defined benefit (DB) pensions industry, forcing pension sponsors to take greater notice of the impact that key risks - namely equity, inflation, interest rate and longevity - can have upon their plan's funding status and subsequently the financial viability of the company. Yet despite many sponsors, as well as trustees, recognising the need to improve pension risk management and move to a de-risked position, many remain frustrated by a number of factors. These include out-of-date and inaccurate actuarial valuations, a lack of detail on plan liabilities (notably including an inability to assess individual member cash flows) and an overreliance on external advisors. These frustrations can often lead to incorrect evaluations of the plan's assets and liabilities, poor de-risking decisions and unnecessary costs. Fortunately, modern risk management platforms are now providing sponsors with the means to measure their DB pension risks with the same regularity, precision and transparency typically available for other balance sheet exposures. And as a result, sponsoring companies can be in a much stronger position to make informed risk-transfer decisions and take advantage of market opportunities as and when they arise.

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01 Dec 2010

Dealing with longevity risk

Publication: Treasury Management International (TMI)
Author: Matthew Bale, Director and Co-Head Client Solutions

Despite treasurers and finance directors becoming more and more concerned about the impact that increasing life expectancy may have on the financial viability of their defined benefit (DB) pension scheme, few to date have transacted on a longevity risk-transfer deal. TMI asked Matthew Bale, Director and Co-Head of Client Solutions at PensionsFirst, how sponsors should assess the value-for-money offered by such solutions.

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01 Dec 2010

Priced out of the market

Publication: PensionsWorld
Author: Matthew Bale, Director and Co-Head Client Solutions

With more pension schemes pulling out of potential longevity swap deals in recent months, Pensions World asked Matthew Bale, PensionsFirst Analytics, how sponsors and trustees should assess the value of such longevity solutions.

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07 Oct 2010

Going direct - a different approach to risk transfers

Publication: Professional Pensions
Author: Jeremy Williams, Head of Pension Risk, DMGT

When looking at the risk transfer market, many pension schemes spend considerable time and money engaging with consultants, often with very little to show for their troubles. Jeremy Williams of the Daily Mail General Trust believes there is a better approach.

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01 Oct 2010

Getting to grips with the risk

Publication: Public Servant
Author: James Mushin

The public sector is waking up to the threat posed by defined benefit pension risk. Yet inaccurate actuarial valuations mean that many public pension schemes struggle to understand their exact risk position, says James Mushin, director of Professional Services at PensionsFirst.

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01 Jul 2010

More sophisticated pension risk hedging

Publication: Global Investor
Author: Matthew Bale, Director and Co-Head Client Solutions

For pension funds to execute more efficient hedging strategies, they need more comprehensive pension cashflow information.

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01 Aug 2010

Managing Pension Risk: The Need for More Accurate Cash Flow Analysis

Publication: TMI
Author: James Mushin, Director of Professional Services, PensionsFirst

Defined benefit (DB) pension scheme sponsors are waking up to the need to be able to calculate their scheme's risk position more precisely in order to carry out risk-transfer solutions. Yet their ability to do so effectively is hindered by the traditional methods used to value their scheme's liabilities.

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