Private Pension Fund Solvency Requirements And Own Funds Calculation Rules

Original Language Title: Privāto pensiju fondu maksātspējas normas un pašu līdzekļu aprēķināšanas noteikumi

Read the untranslated law here: https://www.vestnesis.lv/ta/id/146974

Financial and capital market Commission Regulation No 187 of 2006 in Riga on 26 October (financial and capital market Commission Council meeting No. 47 2. p.)
Private pension funds and the solvency requirements of the calculation of the own funds regulations Issued pursuant to the financial and capital market Commission of law article 6, paragraph 1 of article 7, first paragraph, point 1 and point 2 of article 17 and the law "on private pension funds ' 22.1 the second and fifth part i. General questions 1." private pension fund solvency requirements and own funds calculation rules "(hereinafter-the rules) are binding on private pension funds that offer a specific contribution pension plans with guaranteed returns or specified cost pension plans or pension plans provide cover against biometric risks (hereinafter pension funds). The rules are not binding on the closed pension funds, if the employer has taken over responsibility for the closed Pension Fund pension plans obligations.
2. the terms used in the rules: 2.1 the gross risk capital – size, formed by subtracting from the gross amounts payable in the event of death, in accordance with the pension plan member guaranteed death risk coverage, pension gross technical reserves;
2.2. the net risk capital – the size, the less the net amounts payable in the event of death, in accordance with the pension plan member guaranteed death risk cover, net pension technical reserves;
2.3. the financial institution, the financial institution within the meaning of the credit institutions act;
2.4. General use of the term meets the financial and capital market Commission (hereinafter the Commission)-19.05.2006. Regulation No 100 "private pension funds annual report", the provisions of Regulation No 08.08.2003.179 "private pension fund quarterly reporting rules" and Regulation No 299 24.12.2004. "regulations on private insurers and pension funds the establishment of technical provisions and methods" used terms.
II. the solvency margin calculation 3. Pension Fund solvency margin is the sum of: 3.1 if the Pension Fund offers fixed contribution pension plans with guaranteed returns or specified cost pension plans, then calculate the 4 percent of the gross pension technical provisions that apply to these retirement plan participation agreements. The resulting size is multiplied by a coefficient (R1) obtained as the ratio between the net pension of participating contracts, the technical reserves and this membership agreement the gross pension technical reserves at the end of the reporting period. This rate may not be less than the margin;
3.2. If the Pension Fund offers fixed contribution pension plans without a guaranteed rate of return, which provide cover against biometric risks, then calculate the 1 per cent of the gross pension technical provisions that apply to these membership agreements. The resulting size is multiplied by a coefficient (R2) obtained as the ratio between the net pension of participating contracts, the technical reserves and this membership agreement the gross pension technical reserves at the end of the reporting period. This rate may not be less than the margin;
3.3. If the 3.1 and 3.2 in the pension plans intended to cover risks of death, then membership of the pension scheme contracts that the gross capital risk is not a negative size, calculation of 0.3 percent of the gross risk capital and the value obtained total multiplied by a factor (K1), calculated as the ratio between the net risk capital and gross capital risk. This coefficient shall not be less than 0.5. Iii. Own funds calculation 4. Pension funds shall be included in the calculation of own funds: 4.1 Pension Fund paid share capital reduced for preferred shares with dividend accumulation;
4.2. the share premium;
4.3. reserve capital and other reserves, excluding pension technical provisions and revaluation reserves;
4.4 the previous year audited retained profits/losses;
4.5. the reduction of: 4.5.1 the pension fund owned the existing own shares, intangible assets and the loss of the reporting period, investments in credit institutions 4.5.2, financial institutions, insurance companies and reinsurers ' capital and reserves and subordinated capital in which Pension Fund owns, directly or indirectly, 20 per cent or more of the share capital or the total voting shares, shares or part number.
5. Pension funds own funds calculated in addition contain: 5.1. subordinated capital – pension fund loans that the written deal legislation clearly states that the lender is entitled to reclaim to repay the loan before the deadline only a pension in the event of liquidation of the Fund and the lender's claims will be satisfied only after all other creditors, but before the General requirements, and the loan agreement shall meet the following conditions: 5.1.1 determine term subordinated loan capital to be repaid the initial time limit shall not be less than five years or a perpetual subordinated loan capital in the Treaty that it be released no sooner than five years after notification of the receipt of the notice of loan, 5.1.2. the loan agreement does not establish other conditions for early repayment of the loan, except the Pension Fund's liquidation or subject to authorisation by the Commission, the loan agreement 5.1.3 rules can be amended only with the prior written authorisation of the Commission;
5.2. preferred shares with dividend accumulation, provided that the Pension Fund in the event of liquidation of the shares is repaid after the claims of all other creditors, but before any other shareholders, URt.sk.: 5.2.1 determine term the preferred shares with dividend accrual, 5.2.2. perpetual preferred shares with dividend accumulation that meets the following conditions: 5.2.2.1. they can not be reimbursed on the bearer's initiative or without the prior written authorisation of the Commission's 5.2.2.2. the emission prospectus, it is intended that the Pension Fund is entitled to defer dividends and debts paid, if the pension fund after such payment formed insufficient own resources;
5.3. own funds in the calculation of the Pension Fund of contain completely fixed period receive the refunds and perpetual subordinated capital and fixed-term and open-ended to preference shares with a dividend accrual to the extent that the total amount does not exceed 50 per cent of the lesser of the following values: 5.3.1. own funds calculated in accordance with the requirements of paragraph 4, 5.3.2. in accordance with the requirements of paragraph 3, the calculated solvency margin;
5.4. subordinated capital, which is included in the calculation of own funds in the last five years before the expiry of the loan each year will be reduced by 20 percent.
6.5.3 specified period referred to in the subordinated capital to be repaid or a fixed period to preference shares with a dividend accrual amount shall not exceed 25 per cent of the lesser of the following values: 6.1. own funds calculated in accordance with the requirements of paragraph 4, 6.2 in accordance with the requirements of paragraph 3, the calculated solvency margin.
7. the Commission shall allow the pension funds to repay a loan referred to in paragraph 5.1.2 before the deadline at the request of the Pension Fund, after the loan repayment will be met by the law "on private pension funds ' in article 22.1 fourth and fifth in the solvency requirements laid down in part.
Informative reference to European Union Directive provisions included in the law arising from the European Union of Directive 2003/41/EC "on the activities and supervision of institutions for occupational retirement provision".
Financial and capital market Commission President When the U.