Risk-based Supervision of Pension Funds : Emerging Practices and Challenges

Risk-based supervision of pension funds grew out of a project that was jointly conducted by the World Bank and the International Organization of Pension Supervisors (IOPS). The project was initiated in response to the increasing interest in the development of innovative approaches to pension supervision from the member countries of both institutions. The volume provides an initial assessment of the development of risk-based supervision of pension funds in four countries that have been pioneering the development of risk-based supervision methods in various forms. The volume is comprised of a summary chapter and in-depth studies of the experience in four individual countries-Australia, Denmark, Mexico, and Netherlands. These four country studies were prepared by experts familiar with the systems in each of the countries. The studies have been edited by World Bank staff to ensure a consistent approach to the analysis of the various countries' systems. Models of risk-based supervision demonstrate the benefits of moving away from an approach based on strict compliance, specific rules, and quantitative controls toward an approach that puts more emphasis on the identification and management of relevant risks. A risk-based approach encourages supervised entities to place a greater focus on risk management in their daily operations, which promotes a stronger pension system and more effective outcomes for the members of the system. It is also expected that moving to a risk-based approach to supervision will enhance the ability of supervisors to focus resources on areas of highest risk, which will, over time, result in a more efficient use of supervisory resources.

Bibliographic Details

Main Authors:	Brunner, Greg, Hinz, Richard, Rocha, Roberto
Language:	English en_US
Published:	Washington, DC : World Bank 2008
Subjects:	ACCOUNTING, ACCOUNTING STANDARDS, ADVERSE PRICE MOVEMENTS, ASSET ALLOCATION, ASSET BASE, ASSET CLASS, ASSET CLASSES, ASSET LIABILITY MANAGEMENT, ASSET PORTFOLIOS, ASSET PRICES, ASSET QUALITY, ASSET-LIABILITY MANAGEMENT, ASSET-LIABILITY MISMATCHES, BALANCE SHEET, BALANCE SHEETS, BANKING SYSTEM, BOND PORTFOLIO, BUSINESS PLAN, CALCULATION, CALL OPTIONS, CAPITAL ADEQUACY, CAPITAL ALLOCATION, CAPITAL REQUIREMENT, CAPITAL REQUIREMENTS, CENTRAL BANK, COMPLIANCE · REPORTING, CONTRIBUTION, CONTRIBUTION SYSTEMS, CONTRIBUTIONS, CORPORATE GOVERNANCE, CREDIT RISK, CREDIT RISKS, CREDIT STANDING, CURRENCY, DEFINED-BENEFIT PENSION, DEFINED-CONTRIBUTION PENSION, DEPOSITS, DERIVATIVE, DERIVATIVE TRANSACTIONS, DERIVATIVES, DISCLOSURE REQUIREMENTS, DISCOUNT RATE, DOMESTIC BONDS, DOMESTIC EQUITIES, EARNINGS, EFFICIENT INVESTMENT, EQUITIES, EQUITY INVESTMENTS, EQUITY MARKET, EQUITY RETURNS, EURO MARKET, FAIR VALUATION, FINANCIAL CRISIS, FINANCIAL INSTITUTION, FINANCIAL INSTITUTIONS, FINANCIAL INSTRUMENTS, FINANCIAL INTERMEDIARIES, FINANCIAL MARKETS, FINANCIAL RISK, FINANCIAL RISKS, FINANCIAL SECTOR, FINANCIAL SERVICE, FINANCIAL SERVICES, FINANCIAL SERVICES AUTHORITY, FINANCIAL STABILITY, FINANCIAL STATEMENTS, FINANCIAL SYSTEM, FIXED INCOME, FOREIGN CURRENCY, FOREIGN EQUITIES, FULL-TIME EMPLOYEES, FUND MANAGERS, GOVERNMENT BOND, GOVERNMENT BOND YIELDS, GOVERNMENT BONDS, GOVERNMENT SECURITIES, GROSS DOMESTIC PRODUCT, HOLDINGS, INCOME INSTRUMENTS, INDIVIDUAL ACCOUNTS, INFORMATION SYSTEM, INFORMATION SYSTEMS, INSURANCE, INSURANCE COMPANIES, INSURANCE INDUSTRY, INTEREST RATE, INTEREST RATE RISK, INTEREST RATE RISKS, INTEREST RATE SWAPS, INTEREST RATES, INTERNAL AUDITS, INTERNATIONAL BANK, INTERNATIONAL SETTLEMENTS, INVESTMENT PATTERNS, INVESTMENT PERFORMANCE, INVESTMENT POLICIES, INVESTMENT REGIME, INVESTMENT REGULATION, INVESTMENT RETURNS, INVESTMENT RISK, INVESTMENT STRATEGIES, LABOR FORCE, LABOR MARKET, LEGAL OBLIGATION, LIABILITY, LIFE EXPECTANCY, LIFE INSURANCE, LIFE INSURANCE COMPANIES, LIQUID ASSETS, LIQUIDITY, LONG-TERM INTEREST, LONG-TERM INTEREST RATE, MARGIN REQUIREMENTS, MARKET ANALYSTS, MARKET CONDITIONS, MARKET DEVELOPMENTS, MARKET DISCIPLINE, MARKET LIQUIDITY, MARKET PARTICIPANTS, MARKET RISK, MARKET VALUE, MARKET VALUES, MARKET YIELD, MATURITY, MINIMUM CAPITAL REQUIREMENT, MINIMUM CAPITAL REQUIREMENTS, MORTGAGE, MORTGAGE BONDS, MORTGAGE LOANS, MORTGAGES, OCCUPATIONAL FUNDS, OTHER ASSETS, PENSION, PENSION ASSETS, PENSION COMPANIES, PENSION CONTRIBUTIONS, PENSION FUND, PENSION FUND ADMINISTRATORS, PENSION FUND ASSET, PENSION FUND SUPERVISION, PENSION FUNDS, PENSION PLAN, PENSION PLANS, PENSION POLICY, PENSION PROVIDERS, PENSION SCHEMES, PENSION SECTORS, PENSION SYSTEM, PENSION SYSTEMS, PENSIONERS, PENSIONS, PORTFOLIO, PORTFOLIO VALUATION, PORTFOLIOS, PRIVATE LOANS, PRIVATE PENSION, PRIVATE PENSION FUNDS, PRIVATE PENSION PLANS, PROBABILITY, PRUDENTIAL REGULATION, PUBLIC DEBT, RATE OF RETURN, REGULATORY AUTHORITY, REGULATORY FRAMEWORK, REGULATORY STANDARDS, REGULATORY STRUCTURE, RESEARCH ASSISTANCE, RESPONSIBILITIES, RETIREMENT, RETIREMENT INCOME, RETIREMENT SAVINGS, RETURN, RETURNS, RISK ASSESSMENT, RISK ASSESSMENT PROCESS, RISK CAPITAL, RISK CONTROL, RISK CONTROLS, RISK EXPOSURE, RISK EXPOSURES, RISK FACTOR, RISK FACTORS, RISK MANAGEMENT, RISK MANAGEMENT STRATEGIES, RISK MANAGEMENT SYSTEM, RISK MANAGEMENT SYSTEMS, RISK PROFILE, RISK SCORES, SENIOR, SMALLER FUNDS, SOCIAL INSURANCE, SOCIAL INSURANCE SYSTEMS, SOLVENCY, SPECIAL SAVINGS, STAKEHOLDERS, SUPERVISION OF BANKS, SUPERVISION OF PENSION FUND, SUPERVISION OF PENSION FUNDS, SUPERVISORY AGENCIES, SUPERVISORY AGENCY, SUPERVISORY AUTHORITY, SWAP, SWAP CURVE, TAX, TAX LAWS, TRADITIONAL FINANCIAL INSTITUTIONS, TRANSPARENCY, USE OF DERIVATIVES, VALUABLE, VALUATION, WITHDRAWAL, YIELD CURVE,
Online Access:	http://documents.worldbank.org/curated/en/2008/01/9484201/risk-based-supervision-pension-funds-emerging-practices-challenges https://hdl.handle.net/10986/6419
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