Pension advisers are calling for a statement from the Danish pension provider Danica Pension about future plans for its investment products following its takeover of the Danish pension provider SEB Pension, Danish business news service Økonomisk Ugebrev reports.
According to Økonomisk Ugebrev, with the purchase of SEB Pension, Danica went from having the worst product on the market when it comes to defined benefit pension plans, to having the best.
"I am worried that this might end up diluting SEB Pension's fine product. Many pension advisers have recommended SEB's guaranteed product because of the high annual returns posted in client's accounts. It's obvious that an annual return given to clients with guarantees of 3.25 percent at SEB Pension — compared to 1.8 percent with Danica — is more attractive for clients. But, we don't yet know anything about how Danica will deal with this challenge. Clearly, a large group of Danica's clients may feel poorly treated by getting half as much in annual returns to their guaranteed pensions," pension adviser and partner in the Danish pension provider BEDSTpension Gert Nielsen tells Økonomisk Ugebrev.
Danica explains that it awaits the competition authority's approval of the takeover, and that it is presently unable to answer questions regarding the takeover's future implications.
So pension advisers must remain patient. Anders Valdemar Juhl from the Danish independent advisory company Uvildigraad tells Økonomisk Ugebrev there is not much else they can do than advise clients to be aware of the big difference between products.
English edit: Daniel Frank Christensen