All Liability-driven investment (LDI) articles – Page 3
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NewsTPR investment lead mulls role of ‘groupthink’ in LDI crisis
The Pensions Regulator’s lead investment consultant, Fred Berry, has suggested that industry “groupthink” may have played a part in creating the conditions for the liquidity crisis which engulfed defined benefit pension schemes in the autumn.
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NewsTPR expects improved LDI liquidity buffers to be maintained
The Pensions Regulator has set out its expectation that liquidity buffers be maintained across pooled and leveraged liability-driven investment mandates, going beyond the demands of Irish and Luxembourgish regulators.
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NewsLDI pooled funds determined Bank of England intervention
The Bank of England’s bond market intervention was determined by the lack of ability of liability-driven investment pooled funds to receive the liquidity needed from schemes to rebalance in a short period of time, Andrew Bailey has revealed.
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NewsPPF: True impact of LDI crisis is still unknown
The true impact of the liability-driven investment turmoil will only be known when schemes start publishing their annual accounts, especially for a group of pension funds that were not able to meet collateral calls and lost their hedges, the Pension Protection Fund’s head of LDI and credit has warned.
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NewsPodcast: Was the Bank of England right to intervene during the LDI crisis?
Podcast: Was the Bank of England right to intervene in gilt markets in the autumn, as hell broke loose across markets? Cartwright director of investment consulting Sam Roberts makes the case against the central bank’s bond-buying programme. The Lang Cat director of public affairs Tom McPhail, meanwhile, shares his thoughts on the Autumn Statement and the future of the triple lock.
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NewsExperts estimate £500bn in assets are ‘missing’ after LDI crisis
Around £500bn in pension scheme assets are “missing somewhere” as a result of the liability-driven investment crisis, the Work and Pensions Committee has been told, with experts also questioning the role of leverage in these funds and the need for more guidance from regulators.
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NewsL&G blames govt for LDI crisis and backs consultant regulation
Legal & General has placed responsibility for the market turmoil that triggered the autumn liquidity crisis firmly at the feet of the government, while adding its support to calls for the regulation of investment consultants.
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NewsLDI crisis to hit L&G’s DB revenue and profit by £10mn
On the go: Legal & General has disclosed that its defined benefit business-linked revenues and profits will be hit by around £10mn in its full-year 2022 results, following an autumn liquidity crisis among pension schemes that saw its higher-fee products sold to meet collateral calls.
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NewsTPR and FCA flag governance and competence concerns over LDI
The Pensions Regulator and the Financial Conduct Authority have raised questions over the governance of small schemes and the competence of some investors, in response to questions from a parliamentary committee over the use of liability-driven investments by pension schemes.
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NewsPIC predicts £30bn addressable risk transfer market
On the go: Pension Insurance Corporation has said that falling scheme liabilities will make pension risk transfer market volumes appear smaller over time, predicting a market of £30bn over the next year.
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NewsNational Grid loaned DB schemes £325mn during gilt crisis
On the go: The National Grid stepped in to loan £325mn to two of its defined benefit pension schemes during the recent crisis in the gilt markets at the end of October, according to its latest half-year results.
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NewsFCA highlights investment consultant ‘gap in regulation’
The Financial Conduct Authority has told MPs that it previously pointed to the risks associated with liability-driven investments and suggested the existence of a “gap in regulation” linked to investment consultants, in response to questions over October’s market turmoil and its impact on pension schemes.
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OpinionThe outlook for credit remains strong
It has been an extraordinary few months in UK politics, and a worrying time for some of the country’s largest investors.
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NewsACA pushes new pensions minister for early extension of CDC
On the go: Laura Trott has been urged by the Association of Consulting Actuaries to extend collective defined contribution schemes to more savers as a way of boosting pension savings.
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NewsBoE director calls for greater regulatory oversight on leverage
The Bank of England’s executive director for financial stability strategy and risk has called on regulators to review how leverage is managed, in the wake of a liquidity crisis in October triggered by a spike in gilt yields.
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NewsFiduciary managers rip up schemes’ investment guidelines
On the go: Some fiduciary managers have altered investment guidelines for all of their clients in light of October’s market turmoil, which saw schemes scramble for liquidity in response to collateral calls from liability-driven investment managers.
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NewsSainsbury’s sets up £500mn loan to DB scheme for LDI crisis
Sainsbury’s has set up a £500mn loan facility to ensure its defined benefit scheme has enough liquidity to face collateral calls on its liability-driven investments.
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NewsNest and Sainsbury’s members shrug off LDI crisis
October’s market turmoil and the slump in UK government bonds did not trigger a spike in Nest members checking their defined contribution pots, the research arm of the government master trust has said.
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NewsProfit warnings from DB sponsors jump 38%
On the go: Profit warnings issued by UK-listed companies with defined benefit pension schemes increased by 38 per cent year on year in the third quarter of 2022.
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FeaturesDB schemes and LDI: ‘We’re through that firefighting phase’
Analysis: The dust has settled after a tumultuous month for defined benefit pension schemes.