Product Type: Market Research Report
Published by: TowerGroup
Published: February 2007
Product Code: R301-1251Description The aging of the population has far-reaching implications for employment levels, health care, housing, and employee benefits around the world. On August 16, 2006, the US Congress enacted the Pension Protection Act to address corporate defined benefit and defined contribution retirement savings plans. This Research Note discusses the impact of the Act on defined benefit assets and on the technology decisions of chief technology officers at investment firms. The regulation affects only US firms, but the aging of the global workforce presents firms worldwide with similar problems of underfunding and the need for changes to portfolio strategies to improve investment performance.Table of Contents
- TowerGroup Take-Aways
- Report Coverage
- Leading Indicators of Pension Reform
- Exhibit 1 Underfunding of US Private Pensions (2000-05)
- Exhibit 2 Pension Insurance Claims in the United States (2000-05)
- Highlights of the Pension Protection Act
- Exhibit 3 Important Components of the Pension Protection Act for Defined Benefit Plans (2006)
- Titles I and II: Funding Rules
- Title VI: Fiduciary Rules
- Expected Reactions by Plan Sponsors
- Open Up the Checkbook
- Improve Portfolio Performance
- Exhibit 4 Global Hedge Fund Assets by Increment of Pension Allocation Increase (2006)
- Freeze the Plan
- Exhibit 5 US Workers with Pension Coverage by Pension Type (1983, 1992, 2004, 2011P)
- Considerations for Chief Technology Officers
- Alternative Asset Managers: Even More Demands on Technology
- Prepare for Increases in Assets and Transaction Volumes
- Recognize the Demands of Pension Plan Sponsors and Their Consultants
- Assess the Feasibility of Technology Outsourcing
- Long-Only Asset Managers: Focus on Alternative Strategies and Efficiency
- Prepare for Mergers and Acquisitions
- Support Electronic Trading into Alternative Securities
- Apply Understanding and Processes of Client Reporting to New Portfolio Strategies
- Rethink Technology Investments
- Utilize Service-Oriented Architecture (SOA)
- Summary
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