Lyxor develops unique services program for pension funds

This solution has been created in response to the chronic pension plan deficits and historically low interest rates currently being seen across Europe.

Lyxor’s Enhanced Architecture Program (LEAP) offers a unique and flexible combination of modules enabling pension funds to increase operational efficiency by cutting costs and gaining access to the best investment solutions, in order to improve their investment performance. With this programme, pension funds can optimise the structure of their investment vehicles, providing better risk management and governance. This can generate savings of up to 40% on operating costs for the owner of the assets.

Lyxor provides additional services to pension funds by implementing solutions along the full investment value chain, – from strategic asset allocation to selecting and managing funds – thereby providing pension funds with sophisticated investment resources which had historically only been available to large pension funds.

Lyxor currently manages USD 8.5 billion for various global institutional clients using this concept, which can be adopted in full fiduciary management or in individual modules. LEAP addresses the structural challenges currently facing pension funds – increased longevity, regulatory constraints – as well as circumstantial challenges – low interest rates, financial market volatility – which translate into large deficits for European retirement plans. EIOPA [1] estimates that European occupational pension schemes are underfunded by an aggregate EUR 428 billion.

Commenting on the LEAP programme, Amber Kizilbash, Head of Sales and Client Strategy at Lyxor AM, said: “In a complex environment, pension funds must examine every aspect of their business to ensure they are functioning optimally. The implementation of LEAP, supported by Lyxor’s proven expertise in fund selection and structuring, enables greater efficiency and consistency in pension fund operation, which translate into direct benefits for future pensioners.”