A part of Watch Media

AMWatchFriday27 January 2023

  • Search
  • Log in
  • Fund Management
  • Pension
  • Responsible Investing
  • People
  • Search
  • Log in
  • Latest
  • Search
  • Log in
  • Fund Management
  • Pension
  • Responsible Investing
  • People
07/08/2017at 13:39

PFA not ready to back European pension product

The European Commission's proposal for a pan-European pension product has many positive measures, says PFA Group CEO Allan Polack. But some important details still need work before the pension company is willing to provide the insurance schemes to the European public.
Allan Polack, CEO of PFA. | Photo: PR
by MICHAEL TRIER DUELUND

Some edges still need smoothing out, but Allan Polack, chief executive of the largest pension fund in Denmark, PFA, is overall favorably disposed to the European Commission's new proposal for a new pan-European pension product.

"This shows the Commission's intention to carry through with something that has been discussed for a long time, something that was part of the capital market plan. It is proof of a certain commitment and a pretty clear timetable – the details can be finalized at some point during the second half of 2017," he tells FinansWatch.

That being said, Polack sees a number of counter arguments for PFA joining in with the selling of pension products to the European public.

Chance of more euro in the cash pile

Last week, the European Commission presented its proposal for a pan-European pension product. The product will first and foremost ensure change for the inhabitants of countries where saving for retirement is not yet common practice. For this reason, the product will not have much effect in Denmark, which has one of the world's most well-established pension systems.

However, the proposal could still prove interesting to larger commercial pension funds in Denmark, as they would get a considerable amount of euro under management should they choose to sell the product outside Denmark.

PFA is still choosing to wait for more details on the exact nature of the pension product before the company volunteers to sell the product.

Now that you have some more details to look at, will this be of interest to PFA?

"It's too early to say," says Polack.

Not the main point on the agenda

What criteria would make this interesting to PFA?

"If the processes behind it are digital. This goes for distribution, updating and transfer."

Do you expect that to happen?

"We will see within the next six months. I don't think the proposal gives away much. It's a question of making it interesting, and in order to do that, it has to work efficiently in our system, and it has to create value for our customers," says Polack.

Could it potentially be interesting for PFA to reach abroad?

"Maybe. It's not the main point on our agenda. But it is, of course, something that we are considering — searching for opportunities.”

Do you believe that PFA could compete with foreign players?

"The Danish pension structure and our products are definitely competitive in comparison to, for example, continental Europe," Polack says.

Guarantee reduces competition

One of the biggest challenges that Polack sees in the proposal is that the product will contain a guarantee of zero percent returns. This reduces the pension market's competitive strength, he says.

"Schemes with guarantees are difficult to move. There's a risk of ruining the market's competitiveness. And that was the whole point to begin with: Get the whole pension market competing so the money goes where it is managed best," he says.

So you fear that pension customers could get stuck with the pension scheme they chose to begin with?

"Yes. And ultimately, that begs the question of whether customers will even want to start saving. If you feel stuck with one choice, you might not want to choose at all. I think this point needs more work," says Polack.

Denmark's second-largest pension fund, Danica, will not comment on the pan-European pension product's appeal.

"We have read the European Commission's proposal with great interest. It is positive that the need for pension savings is being put into focus in Europe. Denmark doesn't have the same challenges to face that many other European countries have. We already have elaborate occupational pensions, and a relatively large proportion of Danes are saving for retirement," Mads Moberg Bjørnsen, senior economist at Danica Pension, writes in an e-mail to FinansWatch.

FinansWatch was unable to get any comment from Nordea Liv & Pension.

English Edit: Marie Honoré

Sign up for our newsletter

Stay ahead of development by receiving our newsletter on the latest sector knowledge.

!
Newsletter terms

Front page now

Maunu Lehtimäki, CEO of Evli. | Foto: PR Evli.
AMWatch

Alternative sales grow and net flows start to stabilize at Finland's Evli

In 2022, the sales of Evli’s alternative investment products saw notable growth with fee income from this product range increasing by 50%. CEO Maunu Lehtimäki evaluates the company’s annual results.
  • Positive December fund flows bring two Nordic countries into plus for 2022
  • Evli expands fund range to include new asset classes

For subscribers

Speed is of the essence when launching new investment products, CFO Masih Yazdi says. | Foto: PR / SEB
Fund Management

SEB aims for speedy product launches to make up for huge AUM drop in 2022

For subscribers

Foto: Thomas Borberg/Ritzau Scanpix
Responsible Investing

Dane's equity holdings shrank by 9% in 2022

For subscribers

Foto: Shannon Stapleton/Reuters/Ritzau Scanpix
AMNews

Investors are missing earnings data after 2022 IPO collapse

For subscribers

Karl C. W. Mathisen fills position as CEqO at Folketrygdfondet on Feb. 1. | Photo: Folketrygdfondet
People

Folketrygdfondet finds new head of equities in own ranks

For subscribers

Pension firms can play a significant role to make companies more in a more sustainable direction, says SPP and Storebrand Head of Sustainability, Johanna Lundgren Gestlöf. | Photo: Jonas Eng
AMNews

Two more pension firms join the green club in Swedish sustainability rankings

For subscribers

Further reading

Storebrand Fonder CEO Åsa Wallenberg considers sustainability a guiding principle for the company. | Foto: Fredrik Hjerling
Fund Management

Storebrand Fonder provides more than three-quarters of Swedish fund inflow

The fund manager contributed the lion’s share of net inflow to the Swedish fund market last year – SEK 14.5bn of a SEK 19bn total. Sustainability is the key to the company’s investment policy.

For subscribers

Maunu Lehtimäki, CEO of Evli. | Foto: PR Evli.
AMWatch

Alternative sales grow and net flows start to stabilize at Finland's Evli

In 2022, the sales of Evli’s alternative investment products saw notable growth with fee income from this product range increasing by 50%. CEO Maunu Lehtimäki evaluates the company’s annual results.

For subscribers

Archive. Financial district Barcode in Bjørvika, Oslo. | Photo: Jörgen Skjelsbæk
Fund Management

Here is how Norwegian fund managers performed in 2022

Assets under management from Norwegian-registered fund managers fell by almost 8.2% in total in 2022, but differences among individual managers are vast.

For subscribers

Latest news

  • Two more pension firms join the green club in Swedish sustainability rankings – 16:01
  • Investors are missing earnings data after 2022 IPO collapse – 15:07
  • Dane's equity holdings shrank by 9% in 2022 – 14:48
  • SEB aims for speedy product launches to make up for huge AUM drop in 2022 – 10:42
  • Alternative sales grow and net flows start to stabilize at Finland's Evli – 10:27
  • Folketrygdfondet finds new head of equities in own ranks – 09:37
  • Global clean-energy investments match fossil fuel for the first time – 07:50
  • Here is how Norwegian fund managers performed in 2022 – 26 Jan
  • Morgan Stanley fines its bankers over messaging breaches – 26 Jan
  • Slight recovery in SEB’s AUM in fourth quarter – but outflow continues – 26 Jan
See all

Jobs

  • PenSam søger en jurist med interesse for den finansielle sektor

  • Porteføljemanager til danske ejendomme i PenSam

Watch Jobs

  • Revisor med minimum et par års erfaring

  • Salesforce-udvikler eller -arkitekt

  • People and Operations Partner

  • Danske Rederier søger klimakonsulent til barselsvikariat

  • Senior Porteføljemanager

See all jobs

Jobs

  • PenSam søger en jurist med interesse for den finansielle sektor

  • Porteføljemanager til danske ejendomme i PenSam

See all jobs

Colophon

AMWatch
Search

Sections

  • Fund Management
  • Pension
  • Responsible Investing
  • People
  • Sitemap
  • RSS feeds

Editor

Anne Louise Houmann

alh@amwatch.dk

Tel.: +45 2830 5142

Editor-in-chief

Anders Heering

Publisher

JP/Politiken Media Group Ltd

Advertising

annoncering@infowatch.dk

Tel.: +45 7077 7491

Advertising

Job Advertising

job@infowatch.dk

Tel.: +45 7077 7491

Jobs

Subscription

Try AMWatch or get an offer for a subscription meeting the exact needs of you or your company.

amwatch@infowatch.dk

Tel.: +45 7077 7491

Learn more about subscriptions here

Address

AMWatch

Rådhuspladsen 37

1785 Copenhagen K, Denmark

Tel.: +45 3330 8382

Guidelines

  • Privacy Policy

Copyright © AMWatch — All rights reserved

Microsoft is in the process of discontinuing Internet Explorer – and so are we.
For a better experience, we recommend using one of the following browsers.

Kind regards,
AMWatch

Google ChromeMozilla FirefoxMicrosoft Edge