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Public Pension Funds

With over 70 years of experience, the World Bank Treasury through RAMP helps public pension funds build human capital in asset management.

 

Over 70 years’ experience in asset management with nearly US$200 billion in assets under management

The World Bank Treasury assists with enhancing the financial sustainability of official-sector pension and social security schemes by strengthening their investment operations and infrastructure. In doing so, it draws on its multi-decade experience managing the World Bank Group’s pension funds, as well as other resources, across a broad spectrum of asset classes in global markets, with a track record of optimizing investment returns within a framework of prudent risk parameters.

Nearly 30 years of experience in consulting and building human capital

Since the early 1990s, the World Bank has provided policy advice to its member countries on the design of pension systems. This advice emphasizes the importance of flexible system design within a broad five-pillar framework, customized for individual country conditions, using the principles of affordability and financial sustainability as touchstones. Today, it complements these advisory services with workshops, internships and other capacity building opportunities in fundamental disciplines of public sector asset management.

Pension fund engagements are led by experienced investment professionals who understand pension-specific issues as well as front, middle and back office operations. These practitioners bring to each member a solid understanding of the environment in which official-sector pension funds operate and their organizational structure. While we customize pension fund engagements to individual member needs, most pension fund engagements cover the areas described below.

Governance and institution building

We assist pension funds and plan sponsors with devising governance structures that meet the specific parameters of their scheme, align the incentives of fiduciaries with those of multiple stakeholders and, in the process, ensure transparency of and accountability for results. Historically, good governance of official-sector pension and social security schemes has been a major determinant of their financial performance.

Developing an investment policy appropriate for liability structure

We assist pension funds and plan sponsors with devising governance structures that meet the specific parameters of their scheme, align the incentives of fiduciaries with those of multiple stakeholders and, in the process, ensure transparency of and accountability for results. Historically, good governance of official-sector pension and social security schemes has been a major determinant of their financial performance.

Expanding asset management capacity

We assist fund managers with expanding asset management skills across a range of asset classes by building either external manager programs and/or internal capacity to manage a broad range of fixed income sectors, such as money markets, high-grade government and agency bonds, interest rate futures, and agency mortgage backed securities.

Risk management and analytics

We assist with developing a multi-faceted risk management function with robust quantitative and qualitative risk indicators encompassing market risk, credit risk and operational risk.

Legal support

We provide legal training to in-house lawyers on issues relating to sovereign immunities and protecting pension fund interests through contractual arrangements for securities lending, futures transactions, external asset manager programs, and private sector custodial services.

Financial technology

We provide a diagnostic assessment of financial technology needs. We also assist with building a robust information technology platform for portfolio and risk management requirements.

Developing a public communication strategy

We assist in developing a communication strategy and reporting framework to provide transparent reporting and address frequently asked questions from various stakeholders regarding ability to meet pension obligations, investment strategy, and portfolio, operational and other risks.