CACEIS has identified continued growth in the pensions sector as a key pillar in its 2023-2025 medium-term plan (MTP). To achieve this growth, we leverage our recognised expertise in servicing pension funds, gained through the acquisition of Dutch pensions specialist, KAS Bank. CACEIS has ambitions to become a European market leader for Services to pension funds in Europe, offering our one-stop shop model to cover the full range of pension funds’ servicing needs.
The pensions market is one of the biggest segments in Europe, and accounts for over €8tn in assets1, a figure that is growing at around 5% annually2. CACEIS’ pension fund servicing offer covers all of Europe, including key markets such as the Netherlands, the United Kingdom, Switzerland, and Germany.
CACEIS Pensions Centre
CACEIS provides centralised support for pension fund clients facing the current financial context through the CACEIS Pensions Centre, which combines a centralised hub of experts in Amsterdam with local on-the-ground pensions specialists.
“We offer a full end-to-end solution for the European Pension Industry with front-to-back office functionality, delivering dedicated products and services, especially developed for our pension fund clients. We act as a key partner for pension schemes of all types, helping them efficiently manage investment, operational, sustainability, and regulatory complexity at every stage”, comments Oscar Barneveld, Pensions Product Manager at CACEIS.
Our centralised team of pensions and investment experts have a detailed understanding of the inner workings of pension institutions and asset managers, and can rapidly provide solutions to optimise the entire processing chain. Our centralised pension servicing division counts 110 investment and pensions professionals and follows a highly consultative approach. This, combined with the expertise of our local entity pensions specialists ensures a close fit for clients’ needs. Collectively, CACEIS brings a unique package that helps pension institutions of all sizes anticipate market challenges and take advantage of business development opportunities.
We provide full servicing for all asset classes: alternatives, traditional assets, private assets, listed and non-listed assets, and any type of fund structure - all within one platform. “We help pension clients manage and monitor complex multi-asset portfolios, supported by robust middle and back office capabilities. Our wide range of reporting solutions are all designed from the ground up to offer look-through transparency; Risk, Performance and ESG Reporting, and of course Client Reporting including Asset Allocation and Regulatory Reporting”, adds Frans Hofkens, Head of Business Development for CACEIS in the Netherlands.
Pensions Developments in Europe
The landscape is evolving rapidly and pension institutions face multiple challenges; changing demographics, increasing life expectancy, market consolidation, rising demand for consumer choice, and a constant barrage of incoming regulation, at both an EU and national level.
“New ESG regulations like the Sustainable Finance Disclosure Regulation (SFDR) and frameworks such as the Task Force on Climate Related Financial Disclosures (TCFD) - will increase demands for timely and accurate ESG data. New cost transparency requirements are surfacing across Europe due to the European Insurance and Occupational Pensions Authority (EIOPA) regulations. These growing demands for transparency and increasingly stringent regulatory requirements present unique challenges as well as opportunities. The need to handle greater complexity is driving change in how pensions are designed and this creates a clear demand for our services”, states Oscar Barneveld.
“In the UK, sustainable governance has been a strong theme for many years. Cost transparency is a well-established requirement for many schemes. We already collect costs on behalf of pension schemes that have an aggregate value over £540bn. Furthermore, pension schemes have to report on their exposure to climate risk using the TCFD framework, which is creating more demand for good quality data to assess and monitor ESG and climate risks. This is where we can add additional value by helping our clients navigate evolving sustainability regulation”, commented Pat Sharman, Country Managing Director, UK.
There is a move to Defined Contribution (DC) plans across Europe, which means that the pay-outs during retirement are individualised, and the actual monthly pension payment is directly linked to the contributions made during the working life combined with the returns on the investments. In the past we mostly saw Defined Benefit (DB) plans; the monthly retirement payment was guaranteed and not linked to any investment performance.
In the Netherlands, the new Pension Reform Act will move all existing collective pension assets into individualised personal pension pools, but still with collective components. This will result in more than €1.3tn in assets being transformed from collective pension funds into individual asset pools. CACEIS is assisting clients in tackling this major change with our dedicated team of experts who coordinate with every party involved. Our systems handle DC pension schemes on a full-STP basis enabling life-cycle models in which monthly payments are made into a pension pool that is automatically allocated to investments based on an employee’s age and risk profile.
Client expectations for a Pensions Servicing Specialist
As pension institutions are responsible for millions of people’s retirement payments, their custodian partner must be a financially and operationally stable bank. CACEIS clearly meets this requirement: CACEIS is backed by two of Europe’s largest banking groups, Crédit Agricole and Santander, and has a clear strategy for continued business growth. The growing importance of corporate sustainability is reflected in CACEIS’ CSR strategy which ensures we act as a reliable partner for our clients and an ethical player for society at large.
Due to the ever-changing regulatory landscape, clients seek a flexible and innovative partner, able to deliver all the data they need. “We provide our pension clients high-quality, industrialised solutions that offer flexibility to suit their specific requirements. They benefit from a significant degree of comfort, as well as business security and cost optimisation. Our services operate in full compliance with regulations, by dedicated expert teams, and based on a robust technical infrastructure”, concludes Frans Hofkens.
CACEIS has recently onboarded Blue Sky Group, one of the bigger Pension Administrators in the Netherlands with over €30 billion in AuA, and its first UK local government pension scheme (LGPS) client, Bedfordshire Pension Fund, this year. These two deals demonstrate our commitment to the pensions sector and to the targets laid out in our 2025 medium-term plan.
1 Source: OECD (2022), Pension funds' assets (Global pension statistics - OECD)
2 Source: Global Pension Assets Study - 2021 - Thinking Ahead Institute