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Pension fund

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Pension fund

A pension fund is any plan, fund, or scheme which provides retirement income.

Pension funds in 2005

Pension funds are important to shareholders of listed and private companies. They are especially important to the stock market where large mutual funds, insurance companies, currency reserves, sovereign wealth funds, hedge funds, or private equity.[2] Although the (Japan) Government Pension Investment Fund (GPIF) lost 0.25 percent, in the year ended March 31, 2011 GPIF was still the world's largest public pension fund which oversees 114 trillion Yen ($1.5 trillion).[3]

Contents

  • Classifications 1
    • Open vs. closed pension funds 1.1
    • Public vs. private pension funds 1.2
  • Examples 2
    • Australia 2.1
      • Government 2.1.1
      • Industry (not-for-profit) 2.1.2
      • Private 2.1.3
    • Brazil 2.2
    • Canada 2.3
      • Government 2.3.1
      • Private 2.3.2
    • Chile 2.4
    • China 2.5
    • Hong Kong 2.6
    • India 2.7
    • Japan 2.8
    • Malaysia 2.9
    • Morocco 2.10
    • Netherlands 2.11
    • Norway 2.12
    • Romania 2.13
    • Singapore 2.14
    • Switzerland 2.15
    • United States 2.16
      • Government 2.16.1
    • Saudi Arabia 2.17
    • Greece 2.18
      • Private 2.18.1
    • Turkey 2.19
      • Government 2.19.1
      • Private 2.19.2
  • Largest pension funds 3
  • See also 4
  • References 5

Classifications

Open vs. closed pension funds

Open pension funds support at least one pension plan with no restriction on membership while closed pension funds support only pension plans that are limited to certain employees.[4]

Closed pension funds are further subclassified into:

  • Single employer pension funds
  • Multi-employer pension funds
  • Related member pension funds
  • Individual pension funds

Public vs. private pension funds

A public pension fund is one that is regulated under public sector law while a private pension fund is regulated under private sector law. In certain countries the distinction between public or government pension funds and private pension funds may be difficult to assess. In others, the distinction is made sharply in law, with very specific requirements for administration and investment. For example, local governmental bodies in the United States are subject to laws passed by the states in which those localities exist, and these laws include provisions such as defining classes of permitted investments and a minimum municipal obligation.[5]

Examples

Australia

Government

Industry (not-for-profit)

Private

Brazil

  • Previ
  • Petros
  • Funcef
  • Valia
  • Fundação Banrisul
  • Fundação CESP
  • Fundação Itaubanco
  • Sistel
  • Banesprev
  • Forluz
  • Centrus
  • Baneses
  • Aceprev

Canada

Government

Private

Chile

China

Hong Kong

India

  • 5 Lakh Crore (US$ 91 Billion) as of 2013. EPF
  • National Pension Scheme - A defined-contribution-based pension scheme launched by the Government Of India open to all Citizens of India on a voluntary basis and mandatory for the employees of Central Government (except Indian Armed Forces) who are appointed on or after 1 January 2004. Indian citizens between the age of 18-55 are eligible to join. PFRDA

Japan

Malaysia

Morocco

Netherlands

Norway

Romania

The pension system in Romania is made of 3 pillars, one is the state pension (Pillar I - Mandatory), second is a private mandatory pension were the state transfers a percentage of the contribution it collects for the public pension and third an optional private pension (Pillar III - Voluntary).

The Financial Supervisory Authority - Private Pension is responsible for the supervision and regulation of the private pension system.[7]

Singapore

Switzerland

United States

In the United States pension funds include schemes which result in a deferral of income by employees, even if retirement income provision isn't the intent.[8] The United States has more than $9.838 trillion in assets as of March 31, 2010.[9] The largest 200 pension funds accounted for $4.540 trillion as of September 30, 2009.[10]

Government

Saudi Arabia

  • the general organization for social insurance

Greece

Government

  • Public Employees Pension Fund [2]

Private

  • TAPILTAT, the Fund for Mutual Assistance of the Employees of Ioniki Bank and Other Banks, the multi-employer auxiliary pension fund.

Turkey

Government

Social Security Institution was established by the Social Security Institution Law No:5502 which was published in the Official Gazette No: 26173 dated 20.06.2006 and brings the Social Insurance Institution, General Directorate of Bağ-kur and General Directorate of Emekli Sandığı whose historical development are summarized above under a single roof in order to transfer five different retirement regimes which are civil servants, contractual paid workers, agricultural paid workers, self-employers and agricultural self-employers into a single retirement regime that will offer equal actuarial rights and obligations. The Social Security Institution is continuing its activities to provide better quality of services for our citizens with the participation of whole staff putting all their energy individually and institutionally.

Private

  • Armed Forces Pension Fund

OYAK, (Ordu Yardımlaşma Kurumu/Armed Forces Pension Fund) provides its members with "supplementary retirement benefits" apart from the official retirement fund, T.C.Emekli Sandığı/SSK, to which they are primarily affiliated.

In addition to the retirement benefit, OYAK pays "disability benefits" to the members on duty when they become partially or fully disabled as well as "death benefits" to the heirs of the deceased member if the death occurs during the member's subscription to the Foundation.

OYAK is incorporated as a private entity under its own law subject to Turkish civic and commercial codes. OYAK while fulfilling its legal duties, as set in the Law, also provides its members with social services such as loans, home loans and retirement income systems.

The initial source of OYAK's funds is a compulsory 10 percent levy on the base salary of Turkey's 200,000 serving officers who, together with 25,000 current pensioners, make up OYAK's members.

Some other Turkish private pension funds:

  • YAPI ve KREDİ BANKASI A.Ş. Mensupları Yardım ve Emekli Sandığı Vakfı
  • AKBANK T.A.Ş. Mensupları Tekaüt Sandığı Vakfı
  • TÜRKİYE GARANTİ BANKASI A.Ş. Memur ve Müstahdemleri Emekli ve Yardım Sandığı Vakfı
  • TÜRKİYE ODALAR BORSALAR VE BİRLİK PERSONELİ SİGORTA VE EMEKLİ SANDIĞI VAKFI
  • TÜRKİYE İŞ BANKASI A.Ş. Mensupları Emekli Sandığı Vakfı

Largest pension funds

Country Fund Assets US$ (in billions) Inception Origin
 Japan Government Pension Investment Fund $1370[11] 2006 Non-commodity
 Norway Government Pension Fund of Norway $856[12] 1990 Oil
 United States Civil Service Retirement and Disability Fund $832[13] 1920 Non-commodity
 Netherlands Stichting Pensioenfonds ABP (ABP) $427 (€309) 1922 Non-commodity
 South Korea National Pension Service (NPS) $400[14] 1988 Non-commodity
 United States Thrift Savings Plan (TSP) $330[15] 1986 Non-commodity
 United States (California) California Public Employees' Retirement System (CalPERS) $289.8[16] 1932 Non-commodity
 Netherlands Stichting Pensioenfonds Zorg en Welzijn (PFZW, formerly PGGM) $197 (€142.8) 1969 Non-commodity
 United States (California) California State Teachers' Retirement System (CalSTRS) $189.1[17] 1913 Non-commodity
 Canada Canada Pension Plan and CPP Investment Board $183 (CAD$189)[18] 1965 Non-commodity
 China National Social Security Fund $177.4[19] 2000 Non-commodity
 Canada (Quebec) Caisse de dépôt et placement du Québec (The Caisse, or CDPQ) $176[20] 1965 Non-commodity
 Malaysia Employees Provident Fund $130[6] 1991 Non-commodity
 Canada (Ontario) Ontario Teachers' Pension Plan $130 1990 Non-commodity
 Brazil Caixa de Previdencia dos Funcionários do Banco do Brasil (PREVI) $80 1904 Finance
 Ireland National Pension Reserve Fund (NPRF) $30[21] 2001 Non-commodity
 France Pensions Reserve Fund (France) (NPRF) $56[22] 2001 Non-commodity

See also

References

  1. ^ Global Investment Review
  2. ^ The Economist Jan 17, 2008 (economist.com)
  3. ^ "World’s Biggest Pension Fund Plans to Start Investing in Emerging Markets". Bloomberg. September 30, 2011. 
  4. ^ OECD
  5. ^ For examples, see "Local Government Law Library". Retrieved 15 May 2011. 
  6. ^ a b [3]
  7. ^ http://www.csspp.ro
  8. ^ 29 USC § 1002 - Definitions | Title 29 - Labor | U.S. Code | LII / Legal Information Institute. Law.cornell.edu. Retrieved on 2013-07-18.
  9. ^ http://www.federalreserve.gov/releases/z1/Current/z1.pdf
  10. ^ P&I Online
  11. ^ Government Pension Investment Fund, Japan. Gpif.go.jp. Retrieved on 2013-07-18.
  12. ^ Market value. norges-bank.no Retrieved on 2014-04-29.
  13. ^ Budget of the United States Government, FY2014. Office of Management and Budget April 10, 2013
  14. ^ "Korea’s $400 Billion Pension Plans Hiring Spree for Push". Bloomberg. 7 February 2014. 
  15. ^ Financial Statements of the Thrift Savings Fund. April 15, 2013
  16. ^ Current Investment Fund Values. Calpers.ca.gov. Retrieved on 2014-05-10.
  17. ^ [4]. calstrs.com. Retrieved on 2014-08-06.
  18. ^ Assets under management as of June 30, 2013. cppib.com. Retrieved 2013-09-06
  19. ^ http://www.ssf.gov.cn/cwsj/ndbg/201309/t20130928_5909.html
  20. ^ http://www.lacaisse.com/en/results
  21. ^ NPRF
  22. ^ FRR 2012 Annual Report
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