SWITZERLAND - Swiss pension funds are still refusing to shave equity allocations despite more sinking returns.
New data from ASIP (Swiss Pension Fund Association) and consultants Watson Wyatt shows that returns continued to slide during the first half of 2002. The median performance both public and private pension funds was -5%.
Some 65 pension funds with over 550 mandates (CHF75bn in assets) were polled for the analysis, which did not include direct real estate investments due to valuation complexities. This suggests that total returns could be slightly better, explained Watson Wyatt.
But despite recent stock market volatility, Swiss funds have maintained a stable asset allocation strategy during the last six months. Equities as an overall percentage of total assets declined only marginally due to the purchase of more equity securities.
The best performance of Swiss equity composites during the 1H was -4.8%, which exceeded the return of the SPI Benchmark Index. The median return was -6.4%.
The most positive returns came from Swiss fixed income (Pictet Total Index +3.4%). The median return for this asset class was +3.3%.
Enhanced powers for The Pensions Regulator (TPR) to prosecute and fine company directors who "wilfully or recklessly" put their defined benefit (DB) pension scheme at risk will be hard to enforce, commentators say.
Melrose has pledged to contribute up to £1bn to GKN's pension schemes as part of a final offer to acquire the engineering business.
Existing master trusts will be forced to pay £41,000 when applying for authorisation under the upcoming regime, the government has confirmed.
UPDATE 2 - DWP publishes DB white paper: Stronger powers for TPR, DB chair statements to be introduced
The Pensions Regulator (TPR) will be given the power to fine company bosses who deliberately puts their defined benefit (DB) schemes at risk, the government has confirmed.