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Risk-Based Supervision of Pension Institutions in Denmark

Autor: van Dam, Rein; Andersen, Erik Brink
Año: 2008
Resumen: This paper examines the move towards risk-based supervision of pension institutions in Denmark. Although Denmark has not adopted a comprehensive model to assess risk it has developed a number of building blocks which it uses for risk-based assessment. The motivations for improving risk assessment include a desire to identify emerging problems, and concerns about the solvency of pension institutions. In Denmark there is extensive use of guaranteed minimum returns in both the accumulation and payout phases which create substantial obligations on pension institutions, and focus attention on the integrity and solvency of the institutions which provide them. In conjunction with freeing up investment restrictions and moving towards market valuation of assets, the supervisor has introduced a 'traffic light' stress test model which calculates the effect of several market scenarios - the red test which is the more plausible and the yellow test which is possible but less likely. In addition to the use of the traffic light system, there has been a growing emphasis on the adequacy of internal risk control systems and greater reliance on market discipline. Pension institutions have sought to reduce their exposure to market volatility by better matching of assets and liabilities. There is a much better understanding of the risks inherent in the pension institutions' portfolios, and there has been a substantial increase in the use of hedging instruments.

Fuente: Banco Mundial
Clasificación: Regulación y Supervisión
Tipo de Publicación: Documentos de Trabajo
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The World Bank Pension Conceptual Framework

Autor: Banco Mundial
Año: 2008
Resumen: Since the mid 1980's, the World Bank has responded to the need to strengthen social insurance and contractual savings systems providing old age income support in developing countries. Such support has also been driven by pressures of global population aging, the erosion of informal and traditional family support systems, and weaknesses in the governance and administration of existing pension systems. The importance of effective formal sources of retirement income is accentuated by changes in work and family patterns including the increasing participation of women in formal employment, rising divorce rates, diminishing job stability and increases in local and international labor migration. The Bank's conceptual framework has emerged from its experience in Bank-supported reforms and the changing conditions and needs in client countries. Following the important work of the mid-1990's, averting the old age crisis that established key principles and concepts, the Bank's attention has increasingly focused on refining system designs to adapt these principles to widely varying conditions and better address the needs of diverse populations to manage the risks in old age.

Fuente: Banco Mundial
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Artículo Académico
Idioma:

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Pension Funds and Capital Market Development: How Much Bang for the Buck?

Autor: Raddatz, Claudio; Schmukler, Sergio L.
Año: 2008
Resumen: This paper studies the relation between institutional investors and capital market development by analyzing unique data on monthly asset-level portfolio allocations of Chilean pension funds between 1995 and 2005. The results depict pension funds as large and important institutional investors that tend to hold a large amount of bank deposits, government paper, and short-term assets; buy and hold assets in their portfolios without actively trading them; hold similar portfolios at the asset-class level; simultaneously buy and sell similar assets; and follow momentum strategies when trading. Although pension funds may have contributed to the development of certain primary markets, these patterns do not seem fully consistent with the initial expectations that pension funds would be a dynamic force driving the overall development of capital markets. The results do not appear to be explained by regulatory restrictions. Instead, asset illiquidity and manger incentives might be behind the patterns illustrated in this paper.

Fuente: Banco Mundial
Clasificación: Fondos de Inversión
Tipo de Publicación: Documentos de Trabajo
Idioma:

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A Theory of Contribution Density and Implications for Pension Design

Autor: Valdés-Prieto, Salvador.
Año: 2008
Resumen: The adequacy of contributory pensions for the middle classes depends on density of contribution. Density can be far below 100% because the State is unable or unwilling to impose the mandate to contribute on all jobs, especially on poor workers such as many in self-employment and small firms. The paper presents a model where individuals choose whether to bundle saving for old age in a covered job or to save independently while choosing an uncovered job. The determinants of the effective rate of return offered by the contributory pension plan include the earnings differential. This return is then compared with the returns offered by pure saving in the financial market, to determine the equilibrium density of contribution. The paper also applies the model to assess two standard designs for noncontributory subsidies for the old poor. It finds that these standard designs crowd out contributory pensions for the middle classes by reducing density. The paper also considers two second-generation designs for noncontributory subsidies and other approaches to raise density. This model also allows optimization of the combined multipillar structure, where participants get noncontributory pensions and also contributory pensions based on both mandates and fiscal incentives.

Fuente: Banco Mundial
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Documentos de Trabajo
Idioma:

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Efficiency and Performance of Bulgarian Private Pensions

Autor: Impavido, Gregorio
Año: 2008
Resumen: This paper analyzes the performance of the Bulgarian private defined contribution pensions in the second and third pillars of the pension system.

Fuente: Fondo Monetario Internacional (FMI)
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Documentos de Trabajo
Idioma:

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