Dutch watchdog’s rate tinkering ‘threatens’ sustainability of DB schemes

first_imgThe Dutch pensions industry has criticised the regulator’s controversial decision to lower the ultimate forward rate (UFR), part of the discount rate for liabilities, from 4.2% to 3.3%. The Dutch Pensions Federation said it was “very disappointed” by the move, with its director, Gerard Riemen, arguing that defined benefit arrangements would “no longer be sustainable” over time, assuming interest rates remained at their current level or similar levels.PMT, the €65bn pension fund for the Dutch metal industry, said the UFR’s adjustment had reduced its coverage ratio by more than 3 percentage points, to just over 100%.Director Guus Wouters said the amended rate would also threaten PMT’s five-year pensions contract, designed to increase premium stability at the scheme.  The €43bn PME scheme said the new UFR would knock 2.4 percentage points off its coverage ratio, lowering it to 100%, while tacking on a full year to a recovery plan already approaching 10 years.Director Eric Uijen added: “The measure will further delay indexation and increase the possibility of future rights cuts.”PME also echoed PMT’s assertion that the new rate would make pensions accrual more expensive. Frank Eldersson, director of pensions at the regulator, defended the new rate, claiming it was more balanced and fairer for all generations, and that it accounted for “as much market information as possible”.The UFR will be based on a 10-year running average of the 20-year forward rate.That average currently stands at 3.3%, but it is expected to fall over the next few years.Eldersson said the new UFR stood to reduce coverage ratios by 6 percentage points at pension funds with predominantly younger participants but just 3 percentage points for average funds and 2 percentage points for funds with older participants.The Pensions Federation, however, predicted that, if the UFR remained at its end-of-May level, it would cut funding by 15% on average – from 7% for younger schemes to 23% for older ones – by 2020. It also argued that the new rate would increase pension funds’ susceptibility to rate changes, and risk destabilising the new financial assessment framework (nFTK).The Federation said the regulator’s decision to opt for a more market-based rate, “just when the European Central Bank’s quantitative easing programme is strongly affecting interest levels”, made little sense. The regulator acknowledged that the new rate could affect contributions next year, predicting an increase in cost-covering premiums of 4-5%, if calculated using current interest rates.It said it expected the impact on contributions, using expected returns, to be half as big.The Pensions Federation added that it feared annual pensions accrual would be squeezed where pension funds had capped the premium level.last_img read more

HBO head takes leave

first_img“Two years ago, I decided that I could handle drinking again. Clearly, I was wrong. Given that truth, I have committed myself to sobriety. I intend to take a temporary leave of absence from HBO effective today, in order to go back to working with AA.” Albrecht said he was “deeply sorry for what occurred in Las Vegas this weekend and for any embarrassment it caused my family, the company I love, and myself.” He called the weekend a “wake-up call to me of a weakness I thought I had overcome long ago.” While he wasn’t free to discuss the incident while authorities and his attorneys are “still determining the facts, it is my hope to do so in the near future,” Albrecht said in his statement. A call to the Clark County, Nev., District Attorney’s Office regarding the arrest was not immediately returned Tuesday. On Sunday in Las Vegas, the HBO chairman and chief executive was arrested for investigation of assaulting his girlfriend outside the MGM Grand casino. The arrest came just hours after Saturday’s Oscar De La Hoya-Floyd Mayweather Jr. boxing match aired on pay-per-view by HBO. Officers assigned to the match reported seeing Albrecht fighting with a woman identified only as his girlfriend in the MGM Grand’s valet parking lot shortly after 3 a.m., a Las Vegas police spokesman said. Albrecht was booked into the Clark County Detention Center and held for investigation of a misdemeanor battery-domestic assault. He was later released.160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! HBO chief executive Chris Albrecht said he was taking a leave of absence to regain control of his alcoholism following a weekend assault arrest in Las Vegas. Bill Nelson, HBO chief operating officer, will take over Albrecht’s duties “pending resolution of the police incident,” the company said. “We take these matters very seriously and will monitor this situation closely,” Time Warner chairman and chief executive officer Richard D. Parsons said in a statement. HBO Inc. is a division of Time Warner. In a statement sent to HBO staff members and released publicly Tuesday, Albrecht said he had been a “sober member” of Alcoholics Anonymous for 13 years. last_img read more

St. Louis says it’s done feeling the ‘hand pass’ blues

first_img“It’s not going to change anyway,” said Tarasenko, who scored in … ST. LOUIS — The St. Louis Blues have officially moved on from the Game 3 controversy.“Seriously, it’s over,” said coach Craig Berube on Thursday morning.Added defenseman Jay Bouwmeester: “It’s done — no use looking back.”Vladimir Tarasenko had a fresh take on Erik Karlsson’s goal at 5:23 of the extra session that gave the Sharks a 5-4 win and a 2-1 lead in the best-of-seven Western Conference championship series.last_img read more

Missile may have caused TWA crash

first_imgA documentary set to air next month on the 17th anniversary of the crash that killed 230 people will “prove that the officially proposed fuel-air explosion did not cause the crash,” the filmmaker said in a statement.The six “also provide radar and forensic evidence proving that one or more ordnance explosions outside the aircraft caused the crash. They do not speculate about the source or sources of the ordnance explosions.”Numerous witnesses had reported seeing a streak of light and a fireball when the plane exploded, leading some to fear the aircraft had been struck by a rocket or missile before it came down over Long Island shortly after takeoff from John F Kennedy airport.The National Transportation Safety Board ruled out terrorism and said the crash probably resulted from an explosion in the plane’s centre fuel tank due to an electrical short circuit in a fuel gauge wire aboard the Boeing 747.The former investigators “were not allowed to speak to the public or refute any comments made by their superiors and/or NTSB and FBI officials about their work at the time of the official investigation,” the filmmaker said.“They waited until after retirement to reveal how the official conclusion by the National Traffic Safety Board (NTSB) was falsified and lay out their case in a new original documentary film.”The six are also filing a petition with the NTSB to reopen the probe.The NTSB said in a statement it was aware of the documentary and would consider the request.last_img read more