The European Insurance and Occupational Pensions Authority (EIOPA) has launched a consultation on the quantitative impact study (QIS) for the 'holistic balance sheet' (HBS) approach, stressing that it would assess only the financial impact such measures would have on IORPs.
EIOPA said the consultation aimed to help IORPs perform the necessary calculations in the event that an HBS approach were to be implemented within the revised IORP Directive. EIOPA said it had paid "particular attention" to the valuation and risk-mitigating effect on solvency capital requirements with regards to pension funds' adjustment and security mechanisms, including conditional and discretionary benefits, last-resort reductions of benefits, sponsor support and pension protection schemes.
As a first step, IORPs participating in the QIS exercise will be asked to perform the valuation of the various components of the HBS. In a second phase, those same IORPs will be required to perform the calculation of the solvency capital requirement.
EIOPA said the QIS would not assess the HBS's impact on "scope and definitions, the role of the supervisor, governance or disclosure to plan members".
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