APAPR: The pension funds will probably be allowed to outsource their asset management
The Private Pension Supervisory Commission (CSSPP) might reconsider the decision whereby the mandatory private pension companies (pillar II) were not allowed to outsource their asset management activity, stated for the portal www.privatepensions.ro Crinu ANDANUT, president of the Private Pension Association from Romania (APAPR), the organization representing the local private pension industry.
“During their last discussion, the board members of the Supervisory Commission (editor’s note: CSSPP) stated they agree to reconsider their decision of not allowing the outsourcing of the asset management activity in the case of mandatory pensions administrators”, stated ANDANUT. Approximately one month ago, CSSPP sent the administration companies a decision notifying them about the interdiction to outsource their asset management activity.
But meanwhile, CSSPP indicated its will to reconsider this decision on two occasions. The first one consisted of a public appearance of Doru FRUNZULICA, CSSPP Board Member, who suggested that investment outsourcing might be allowed, but only if the pension company’s legal accountability is maintained. The second occasion was the high level meeting between APAPR and CSSPP, held last Thursday.
ANDANUT also stated that the pension companies will outsource only technical operations of asset investments, and not the accountability for the investment returns. “For sure, foreign experts in asset management from the parent company of the local pension companies would invest the clients’ money better than a local team of investment directors”, opinionates ANDANUT, who is also the CEO of ALLIANZ-TIRIAC Private Pensions, the market’s second largest mandatory private pension company.
“Besides ALLIANZ-TIRIAC, GENERALI and INTERAMERICAN, the majority of the pension companies also use asset management structures for pension fund administration. This is already happening, although the Commission did not officially allow this outsourcing”, according to sources from the private pension market for www.privatepensions.ro. We still need to see what will be the official decisions made after this debate between the market and the supervisory authority.
