[ad_1]
Denmark’s Velliv has been criticised by the country’s Financial Supervisory Authority (Finanstilsynet, FSA) for being found to have a range of weaknesses in its actuarial work – failures the watchdog says have led to pension payout interest rates conflicting with its own guidelines.
In a statement yesterday on its inspection of the actuarial area of Velliv’s business, carried out in November to December 2022, the FSA said its subsequent report contained a number of official orders to correct procedures as well as reprimands for the DKK325bn (€43.6bn) mutual pension provider.
“The Danish FSA judged there to be a number of strong indicators that there are insufficient resources associated with the actuarial area,” the supervisor said, adding that it had therefore ordered the company to reassess whether its actuarial resources were enough.
Velliv was also handed several official orders relating to the guidelines set by its board for setting out pension payout rates – and therefore payout profiles – for its market-rate pension products.
“Among other things, the company has been ordered to ensure sufficient reporting on the guideline to the board,” the FSA said.
“The Danish Financial Supervisory Authority has also ordered the company to ensure consistency between the guideline and the model used for payout interest, where the same payout interest is used for different product variants, which leads to payout profiles that are in conflict with the guideline,” it said.
According to the watchdog, discussions of actuarial topics by the board were insufficient and not at a level expected for a company of Velliv’s size and complexity.
“As there are, at the same time, several – and in certain areas significant – deficiencies in the board’s management documents in the actuarial area, there is a risk that the company is taking on risks that are not in accordance with the board’s risk appetite,” the FSA said.
Velliv commented on the FSA’s report, saying it took note of the authority’s criticism, and that it had increased its focus on the lack of documentation and business processes in the actuarial field – which it said had been at the centre of the criticism.
“We have already earmarked additional resources for the area,” Velliv said on its website.
“In addition, Jens Muff Wissing was appointed on 1 March 2023 as new responsible actuary,” it said.
Read the digital edition of IPE’s latest magazine
[ad_2]
Source link