Pensions

UK megafund plan is weak tonic for investment ills

14 Nov 2024

Chancellor Rachel Reeves wants to consolidate the 1.3 trln pound retirement sector to create funds with more firepower to support the economy. It’s a worthy move, but could take years to pay off. Britain’s economic problems need more radical action.

Beijing’s pension plan grasps at a utopian reality

17 Sep 2024

China is raising the retirement age for the first time since the 1950s, and increasing the number of years workers must contribute to receive payouts. Both thresholds remain low but policymakers are right to tread cautiously. Boosting the workforce in a slowing economy is risky.

Germany sovereign pension fund is sound but small

3 Apr 2024

Berlin will borrow to invest up to 200 bln euros in global equities to help pay for the retirement of the country’s fast-ageing population. The vehicle’s modest size will limit its long-term impact, but Europe can learn from this blend of public and private schemes.

UK growth plan aims pea-shooter at monster problem

11 Jul 2023

Finance minister Jeremy Hunt wants Britain’s $2.5 trln pension system to invest more in private equity and startups. His scheme avoids the risky idea of forcing managers into buying British assets. But it’s too fuzzy and timorous to solve the country’s dismal lack of investment.

Exploring the City of London’s existential dread

25 Apr 2023

The global financial centre is suffering a spasm of anxiety about its status, while the government is pushing post-Brexit reforms. In this Exchange podcast William Wright, founder of the New Financial think tank, discusses the roots of the malaise and what can be done to fix it.

UK growth hinges on more than a new pension giant

19 Apr 2023

Low investment holds back Britain’s economy. To help, politicians and bankers want to consolidate the 2.2 trln pound retirement system into large, Canadian-style pools buying UK assets. Yet better taxes and planning, and more foreign money, would yield a happier ending.

Capital Calls: BlackRock and ESG, UK pensions

15 Mar 2023

Concise views on global finance: Bank ructions and inflation give Larry Fink, boss of the $8 trln asset manager, cover to talk about something other than climate change in his annual letter; Britain’s abolition of a retirement tax threshold is an expensive way to help the rich.

SAP ends pointless M&A roundtrip with Qualtrics

7 Mar 2023

The $150 bln software giant may sell its stake to Silver Lake. A $12 bln valuation implies mediocre returns for SAP, which bought the survey group in 2018. The buyout firm may struggle to put much debt on the target, crimping its profit, but it looks like a more logical owner.

Global finance unknowns are more “who” than “what”

27 Dec 2022

The blowup of the UK pension market has got regulators hunting for weaknesses in the over-$200 trln shadow banking sector. Emerging market funds and leveraged loans both bring vulnerabilities. But in deciding what to police, the question is who’s exposed. That’s a blind spot.

UK market watchdogs rely on kindness of foreigners

9 Nov 2022

The Bank of England has intervened in government bond trading twice in less than three years. Both times, selling by overseas funds was partly to blame. British regulators have limited oversight of the $2.4 trln gilts market. Their best hope is help from counterparts elsewhere.

Pension fund blowup faces brutal second act

6 Oct 2022

The Bank of England’s $74 bln bond-buying scheme saved retirement plans from losses on government bonds. But the fallout from the crisis means funds with $1.9 trln of assets now need to reduce risk by selling corporate bonds and other esoteric assets. That will spread the pain.

Australia’s investing giant is taking on the world

23 Aug 2022

Inflation and rate hikes made for a tough first year atop AustralianSuper for Paul Schroder. In this week’s Exchange podcast, he lays out his plan to quadruple the country’s largest pension manager in size by expanding abroad, learning from peers and targeting private equity.

Macron has narrow path to avoid domestic stalemate

20 Jun 2022

His party’s poor showing in parliamentary elections diminishes the French president’s authority and casts doubt on planned reforms like a pensions overhaul. He could still govern if he forms a coalition with the conservatives. But any deal will come with substantial concessions.

Emmanuel Macron changes stripes as election nears

15 Mar 2022

The French president’s chances of winning a second term have been boosted by his performance during the pandemic and since Russia’s attack on Ukraine. But the main plank of his platform is to “protect” the French. That’s a far cry from the bold reformer who ran five years ago.

CalPERS offends no one with new investment chief

22 Feb 2022

That’s tough on Nicole Musicco, appointed to run the retirement fund’s nearly $500 bln of assets after an 18-month search. But it reflects politics at the California giant, not her abilities. One goal should be to nudge CalPERS toward the pension model of Musicco’s native Canada.

Aussie proxy reform is wolf in sheep’s clothing

7 Jan 2022

The government is foisting new rules on firms like Glass Lewis and ACSI that offer voting advice for shareholder meetings. Some changes make sense, and one bad idea has been dumped. But on balance they go too far in some areas and not far enough in others.

The Aussies are coming! The Aussies are coming!

5 Jan 2022

Two pension fund managers Down Under are buying a New Zealand hospital chain for $500 mln. It’s a small sign of things to come. As the country’s $2.4 trln superannuation sector grows, consolidates and invests more directly, it will sail beyond the Tasman Sea for takeover targets.

BT safely clears two of three financial hurdles

18 Mar 2021

Britain’s telecom watchdog won’t cap premium broadband prices for at least 10 years, giving the former monopoly more confidence over its 12 bln pound fibre rollout. A 5G spectrum auction also went its way. That sets up the next challenge: fixing its 9 bln pound pension deficit.

CalPERS CIO was too careless to be so bold

6 Aug 2020

Making controversial changes at America’s biggest public pension fund may be necessary. But if Ben Meng was going to do it – despite prejudice about his Chinese connections – his own behavior needed to be unimpeachable. His exit suggests he missed that lesson.

Corona Capital: LatAm pensions, Activism

23 Jul 2020

Concise views on the pandemic’s corporate and financial fallout: Pension reform in Mexico and Chile gets a coronavirus makeover; UK chief executives catch a break during lockdown as the number of activist campaigns collapses.