NETHERLANDS - Almost 50 Dutch pension funds with a funding shortage have yet to submit a recovery plan, a spokesman for De Nederlandsche Bank (DNB) has confirmed.

Around 350 pension funds, out approximately 650 in the Dutch market, have a funding ratio below the regulatory minimum level of 105%, and are therefore required to establish measures by 1 April to restore their financial position.

"We will politely remind the pension funds of their obligations, both verbally and in writing", said the DNB spokesman who was unwilling to elucidate as to why submissions were late.

The regulator has several instruments it can adopt to enforce compliance with its rules, he explained, one of which is imposing fines, though he stressed "that is absolutely not the issue at this point in time."

A spokesman for the VB, the representative body for industry-wide pensions fund, also noted: "Although we have urged our members to submit their plans in time we did not receive any please for an extension of the deadline. That leads us to conclude there are no major obstacles.".

Frans Prins, director of the Dutch association of company pension funds, argued the number of pension funds, failing to meet the 1 April 2009 deadline should also be put into perspective.

"It means 85% of the pension funds with a funding shortage were in time with their [recovery] plans", and added  "most funds will have fulfilled their obligations within a few weeks from now".

Prins further emphasised that under specific circumstances pension funds can ask for extra time to draw up their plans, though the DNB was not prepared to elaborate as to how many funds has requested an extension.

Schemes qualifying for such an extension are likely to be reinsured funds which are being confronted with a funding shortage as a result of the increased credit risk at the reinsurer. And those funds can apply for temporary dispensation, the DNB said in a letter to the funds concerned.

The number of pension funds that have fully or in part reinsured their commitments is estimated at around 150 funds. Experts say the group consists mainly of company pension funds while just two to three small industry-wide schemes are reinsured funds.

Prins continued by stating he had received questions from his members on this subject and said he would "find it a worthwhile to discuss the specific problems of reinsured funds with DNB".

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