Emmanuel Ullmann, chief executive officer of the CHF6.3bn (€6.8bn) Swiss pension fund for the canton of Solothurn (Pensionskasse Kanton Solothurn, PKSO) has lashed out at the occupational pensions supervisory commission OAK BV for meddling with the operational business of Swiss schemes.
The CEO pointed to two hearings started by the regulator – one on the requirements to transfer pension assets from pension schemes not offering 1e plans to those offering the option of 1e plans, and another on minimum requirements for legal transactions by a pension fund with related parties – in a LinkedIn post stating that OAK BV was “intervening very heavily in the operational machine room” of a pension fund.
“What stands out is that these are directives. The pension funds must strictly adhere to them,” he added in the post.
The directive on the transfers of pension assets applies to 1e Pensionskassen, meaning pension funds offering 1e plans for high earners that can choose between 10 investment strategies for asset allocation. The deadline to send the statements to the regulator on the directive is 2 December.
“This first directive describes in detail how a pension fund must divide an insured person’s money. An extremely rare case, there are 44,000 members in total with a 1e plan, and we have never had such a case,” Ullmann said.
The directive on minimum requirements for legal transactions by the pension fund with related parties aims to minimise the risk that, due to conflicts of interest, unfavourable circumstances arise for a pension fund and its members, OAK BV said.
It is intended to create the basis for a uniform application of the law and supervisory activities of the authorities, it added. The deadline for stakeholders to send their responses to the regulator is 31 January.
“[This second directive specifies the monetary limit for significant legal transactions with related parties, and how many offers can be received,” the CEO said, adding that both directives are a sign of how deeply the regulator intervenes in pension funds’ operations.
He added: “For me, this shows a mistrust [by OAK BV] of the highest bodies and the management of pension funds. OAK BV should only act if there are significant misuses.”
The remarks made by the PKSO chief follow criticism of the Swiss pensions industry targeting OAK BV for its definition of improved benefits regarding multi-employer pension funds. OAK BV was forced to revise the definition of improved benefits.
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