Danish pensions body counters political pressure to invest for growth

first_imgDanish pension funds have already invested DKK220bn (€29.5bn) in Danish business and are keen to help create more growth in the domestic economy, according to industry association Forsikring & Pension (F&P).But the risk of such investments has to match the return, it insisted. The association’s chairman Christian Salgild told F&P’s annual meeting: “All my warning lights start to flash when the political side proposes that pension funds invest in companies and sectors considered risky by banks and the FSA, while at the same time those businesses are making big investments in production and jobs abroad.”However, his main message should not be misunderstood, he said. He said the pensions and insurance industry already contributed very significantly to investment and growth in Denmark and wanted to step up efforts, as long as the return matched the risk.New figures from F&P show the pension funds have DKK220bn invested in Danish business.Of this, DKK125bn was in property, DKK85bn in shares, corporate bonds and loans, and DKK10bn in infrastructure, wind energy and public-private partnerships (PPPs), according to the association’s data, covering 85% of the pensions market. “I understand politicians’ desire for more pensions money to go into Danish companies,” said Salgild. But politicians also have to understand the world in which pension funds operate, he said.“We are obliged – legally, too – to safeguard pension savers’ interests first and foremost,” he said.Sagild said the problem facing investment and growth in Denmark was not that Danish companies were caught in a credit crunch.The main problem was rather that the Danish economy was growing too slowly and that Denmark was not nearly as attractive an investment location as other countries.“In a globalised world, it is first and foremost the cost level that determines where companies place their production,” he said.“And this, therefore, also determines which countries and regions will experience growth and increased employment.”last_img read more

Aegon reaps benefits of Dutch residential mortgage boom

first_imgProgress, the €4.5bn pension fund for Unilever, was among the first investors in Aegon’s mortgages fund, committing 5% of its assets to the vehicle last year. At the time, it said it expected its investments in home loans would generate 2.5% more in returns than the market rate.It also cited its desire to increase diversification within its investment portfolio, as well as heed the “call from society” to raise local investment.The €1.5bn pension fund of coffee processor Douwe Egberts (DEPF) also recently announced that it, too, would invest 5% of its assets in the Aegon fund.It said it expected to achieve better returns against “very limited” additional risk, “as most of these mortgages have been issued under government guarantee (NHG)”.Meanwhile, asset manager Syntrus Achmea has also seen its Particuliere Hypothekenfonds grow rapidly.The fund, which issues mortgages to consumers directly, is currently 78% home loans under NHG.According Hugo Ouwehand, the company’s mortgages director, 42 Dutch pension funds have committed a total of €3.8bn to date – not only for diversification purposes, he said, but also to improve risk/return profile and benefit from the spread between swap and market rates.Among the participants in Syntrus Achmea’s fund is the €38bn metal scheme PME.Ouwehand said he expected €1bn in inflows this year, after the vehicle posted increases of €450m and €880m in 2012 and 2013, respectively.He also confirmed that net returns over the last five years had averaged at 6.6%.However, he argued that the Dutch housing market had already “passed its lowest point”, and that pressure on returns would increase.Earlier this year, the Dutch Mortgage Funding Company (DMFCO), with its Munt Hypotheken, established itself as an additional option for direct institutional investment in residential mortgages.Recently, the €55bn metal scheme, the €18bn pension fund for the printing industry (PGB) and the €6.8 scheme for steel works (Hoogovens) committed €2bn in total to the DMFCO scheme.Jeroen van Hessen, a partner at DMFCO, said he expected the vehicle to attract €3bn in total within the next 18 months.Dutch pension funds are still waiting for further developments on the Nederlandse Hypotheek-instelling (NHI), a new institution that is to issue government-backed mortgage bonds.However, the start of the NHI, which aims to issue €25bn in mortgage bonds over the next five years, has already been delayed by several months, following an EU investigation into possible state support.Unilever’s Progress indicated that it was not interested in investing in NHI-issued mortgage bonds, arguing that the NHI would focus on old mortgages, which it said were likely to generate a lower risk premium.Combined mortgage debt in the Netherlands amounted to €637bn at the end of 2013. Aegon Asset Management is among the fund managers benefiting from a shift towards Dutch residential mortgages in recent years, with pension funds looking increasingly for alternatives to government bonds. Aegon AM’s Dutch Mortgage Fund – launched in August 2013 – has already attracted more than €1.8bn in institutional investment.The company said it had returned more than 5% over the first three quarters of 2014, but declined to provide further details on the expected growth of the fund.Aegon’s Dutch Mortgage Fund is currently 81% guaranteed home loans, with a loan-to-value ratio of up to 106% and a duration of 7.2 years on average.last_img read more

Kyle Seager injury update: Mariners third baseman to undergo hand surgery

first_imgKyle Seager will not be on the field for opening day.The 31-year old Mariners third baseman will undergo surgery Tuesday on a tendon in his left hand. He is expected to be out through April and there is no definitive timetable for his return. Mariners’ Felix Hernandez upset he won’t start Opening Day Related News “It sucks, but we’ll deal with it and get through it,” Seager told reporters Monday, via MLB.com.Seager will have surgery tomorrow, but says doesn’t know timeline of how long recovery will take. First time he’s gone on the DL in his career. “It sucks, but we’ll deal with it and get through it.” https://t.co/T1imwlg7Qp— Greg Johns (@GregJohnsMLB) March 11, 2019Seager originally suffered the injury while diving for a ball during a Mariners’ spring training game last week.  Seager slashed .221/.273/.400 in 155 games for Seattle last season. He also hit 22 home runs and tallied 78 RBIs.The eight-year veteran has spent his entire career with the Mariners. He made the All-Star team and won a Gold Glove award in 2014.last_img read more