risk identification in practice
DESCRIPTION
Risk identification in practice. Jurgen Boyd Registrar of Pension Funds FSB South Africa 5 May 2011. Supervisory Landscape. Number of active funds=3 177 Number of Administrators= 309 Number of members= 10 Million Asset value= $171 Billion. Significant Features. - PowerPoint PPT PresentationTRANSCRIPT
Risk identification in practiceJurgen Boyd
Registrar of Pension FundsFSB
South Africa5 May 2011
Supervisory Landscape
• Number of active funds = 3 177• Number of Administrators = 309• Number of members = 10 Million• Asset value = $171 Billion
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Significant Features
• The Board of Fund of retirement funds should comprise of at least 4 members
• At least 50% of the board members must be elected by members
• 95% of funds are DC and the majority are occupational funds
• No preservation or compulsion
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FSB : Risk Model
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FSB : Risk ModelRisk Focus Risk Factors Risk Indicators
Fund Oversight (Governance)
Board of Management
BOT Composition BOT structures Quality, skills, experience Conflict of interest PO fit and proper, skills,
experience
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FSB : Risk ModelRisk Focus Risk Factors Risk Indicators
Funding/ Solvency
(a) Market/Investment Risk
Asset spreading/ concentration
Asset/liability mismatches Funding Levels (DB) Financial strengths of
insurers (Underwritten Funds)
Approved Investment Management
Credit Risk
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FSB : Risk ModelRisk Focus Risk Factors Risk Indicators
Funding/ Solvency
(b) Operational Risk Size, complexity of fund Outsourcing (incl.
Conflicts of interest) Risk Management Culture Statutory Returns Levels of PI cover Level of compliance –
(Legal/Regulatory risk)
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FSB : Risk ModelRisk Focus Risk Factors Risk Indicators Information
SourcesFund Oversight(Governance)
Board ofManagement
BOT Composition BOT structures Quality, skills,
experience Conflict of interest PO fit and proper,
skills, experience
Whistle blowing – PO & ActuaryPFA ComplaintsComplaints lodged with FSBOn-site reviewsFailure to submit returnsAudited A.F.SRI’sUnion’s involvement
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FSB : Risk ModelRisk Focus Risk Factors Risk Indicators Information
SourcesFunding/ Solvency
(a) Market/ Investment Risk
Asset spreading/ concentration
Asset/liability mismatches
Funding Levels (DB) Financial strengths of
insurers (Underwritten Funds)
Approved Investment Management
Credit Risk
Actuarial ValuationsRegulation 28 returnsAudited A.F.SFinancial-QualificationsRisk assessment of IM’sPFA complaintsSection 18 reportsOn-site reviewsRI’sWhistle blowing – PO & Actuary Insurance Supervision9
FSB : Risk ModelRisk Focus Risk Factors Risk Indicators Information
SourcesFunding / Solvency
(b) Operational Risk Size, complexity of fund
Outsourcing (incl. Conflicts of interest)
Risk Management Culture
Policies and procedures
Statutory Returns Levels of PI cover Level of compliance –
(Legal/Regulatory risk)
Risk assessment of administrators/fundsPF 130 assessmentOn-site reviewsAudited A.F.SPFA complaintsComplaints lodged with FSBFailure to issue benefit statementsO/S statutory returnsOn-site reviewsReporting of non or late payment of contributions
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Questions?
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