DENMARK - Danish pension fund ATP returned 4.2%, or DKK15.7bn ($3bn), in the first three quarters of the year, bringing total assets under management to DKK554bn.
ATP chief executive officer said: "ATP's investment return of more than DKK 15bn for Qs 1-3 is satisfactory. Once again, risk diversification, interest-rate hedging and hedging against steep price falls have proven their worth to ATP.
"Europe is in the grip of a double crisis: a sovereign debt crisis and a confidence crisis. This is, quite extraordinarily, sending Danish interest rates below German rates, detracting DKK 8bn from results" he said.
Its reserves, the assets remaining after liabilities are discounted, increased by DKK5.2bn in the first three quarters of 2011 (7.4%) to a total of DKK75.2bn.
Hedging activities that are meant to safeguard the fund from interest rate fluctuations produced a loss of DKK8bn, driven by Danish interest rates falling below German levels.
However, four out of five of the fund's risk categories posted positive returns: interest rates boosted results with a return of DKK11.3bn (7.5%), credit generated DKK1.8bn (3.8%), inflation delivered DKK4.8bn (4.6%) and commodities brought in the least, with DKK0.1bn or returns or 0.9%.
Equities were down DKK2.5bn or -4.6%.
In September, ATP launched NOW Pensions in the UK, a multi-employer trust to rival the National Employment Savings Trust. NOW Pensions is scheduled to go live on 1 January and officials have vowed to offer highly competitive fees. (Global Pensions; 15 September 2011)
The Centre for Social Justice is calling for the state pension age to be raised to 70 by 2028 and to 75 by 2035, a much faster rise than currently planned.
The High Court has blocked the £12bn transfer of Prudential's annuity book to Rothesay Life, citing the insurer's lack of "established reputation" and differing "capital management policies".
Jonathan Stapleton speaks to Punter Southall Governance Services director of outsourced pension services Clare Owen about the firm's latest reseach into the effectiveness of trustee boards.