2005 was the year when the UK pension industry finally bit the risk management bullet. The impact of FRS17 accounting standards (mandatory from 2005 onwards), the Pension Protection Fund's risk-based levy and scheme-specific funding requirements from the UK's Pension Regulator have all played a role. For sponsors, the risk that deficits might grow bigger due to unmatched swings in interest rates or inflation was suddenly too much to bear.
Yet the derivatives-based de-risking strategies enacte
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