FX cap hurts Austrian pension funds’ performance

first_imgA 30% cap on foreign currency exposure has hit Austrian Pensionskassen investment returns in recent years, according to consultancy Mercer.“The cap has limited the domestic pension funds considerably and lost them chances for additional returns,” said Michaela Plank, retirement expert at Mercer Austria.In a low interest rate environment in developed markets it was particularly important for institutional investors to seek returns in other areas of the world, she added.All existing investment caps for Austrian funds will be lifted when the country implements the EU’s IORP II directive, now scheduled for October. The necessary revisions to the Austrian law governing pension funds – known as PKG – was due to pass through parliament before summer but a technicality means it will have to wait till October.However, the Austrian pension fund association FVPK told journalists this week that the amendments, including the abolition of quantitative investment caps, would be agreed on by a majority. Andreas Zakostelsky, FVPKCredit: Franz HelmreichAndreas Zakostelsky, chairman of the FVPK, confirmed that the two coalition parties in the government, the conservative ÖVP and the far-right FPÖ, were “in full agreement” on the package.Regarding other amendments demanded by the IORP II, Austria had “almost no need for amendments”, he added. Most of the EU directive’s standards for transparency, information, governance and risk management are already part of the domestic legal framework.Mercer’s Plank also emphasised that Austrian pension funds already had the risk management in place to be given free rein regarding their investment allocations.Under the proposed amendment to the PKG, every pension fund would have to set down its own allocation guidelines, which would then be approved by the financial market supervisor FMA.Regarding reforms, however, the FVPK was much more excited about next year as the government promised a major tax overhaul. This is expected to include incentives for companies to set up pension plans and an improved tax treatment of additional member contributions.“The time is ripe for a balanced three-pillar pension system,” said Zakostelsky.He said the government had been “pleasantly clear” in its commitment to this goal when it published its agenda last year.So far, however, the coalition was more focused on other topics including Austria holding the rotating EU presidency until December.last_img read more

Arter to savour Premier League life

first_img Press Association The 25-year-old Bournemouth midfielder, who was playing non-league football for Woking five years ago, completed a remarkable journey when he was sent on as a 63rd-minute replacement for Glenn Whelan in Sunday’s 0-0 friendly draw with England at the Aviva Stadium. In the process, he found himself lining up against the likes of Wayne Rooney, Raheem Sterling, Jack Wilshere and Theo Walcott, something he will do on a regular basis next season after helping the Cherries to promotion from the Sky Bet Championship. Arter will now hope to force his way into Ireland boss Martin O’Neill’s plans for Saturday’s vital Euro 2016 qualifier against Scotland, although he is taking nothing for granted as he attempts to ease himself on to the international stage. He said: “I haven’t even really thought about it yet. My main focus is to take each day as it comes. I am still very inexperienced at this level and any part that the manager wants me to play, I’m more than happy to do. “But I haven’t really looked that far forward yet.” Harry Arter enjoyed an early taste of what life in the Barclays Premier League will be like as he was handed his senior debut for the Republic of Ireland. Arter admitted he has rarely faced the prospect of such an exciting summer and is relishing what lies ahead. He said: “When the season ended, it was getting ready for this, really. I knew I might have a slight chance of being called up and when I did, it was to get focused on this. “I haven’t really thought too much about next season and the teams we will be playing against, but once this trip is done, it will be something to focus on with a lot of excitement and get ready for that. “International-level games are different, but these are the players I’m going to be playing against next year, so it was nice to test myself against them and experience it. “It was nice to test myself early on against these sort of players. From afar, you realise how good they are and it’s good to come up against them and test yourself and realise what you are in for next year.” Arter might have announced his arrival in style within minutes when he broke into space and unleashed a long-range shot which flew just wide of Joe Hart’s goal. He said: “I could have flicked Longy (Shane Long) in, but at the time, I felt like I had to have a shot and the manager said, ‘Well done’ for getting into those sort of positions after the game. “It was good to finally get a game and it was a moment I’m sure I will look back on in weeks and months and years to come with a lot of pride. It was a good day.” last_img read more