TORONTO, Jan. 26 /CNW/ - RBC Dexia Investor Services today launched a liability benchmarking tool that helps Canadian pension plans align their assets and liabilities. In 2009, RBC Dexia polled over 370 defined benefit pension plan sponsors and almost half of the respondents selected aligning future liabilities as the biggest challenge their pension plans will face in 2010. RBC Dexia liability benchmark assists in addressing this need, delivering vital information to plan sponsors on the performance of their pension funds against future obligations.
"Our objective liability benchmarking service provides sponsors with an important tool to help monitor their ability to pay their pensioners," said Fay Coroneos, Head, Risk and Investment Analytics, for RBC Dexia. "Making this tool available to our pension clients helps them deal with one of their major challenges and underscores RBC Dexia's commitment to defined benefit pension plan sponsors."
RBC Dexia uses a library of investable Canadian bonds to build a customized liability proxy that reflects the pension plan's unique risk preference and cash outflows, thereby eliminating the need for assumptions. The more common, but less precise, duration-matching or "representative benchmark" approaches rely heavily on assumptions around discount rates and plan liability profiles.
Traditionally, pension plans have focused on maximizing returns by measuring absolute performance against an asset-only benchmark or a target universe. While such benchmarks are important, equally essential is the plan's ability to demonstrate that it can meet ongoing benefit commitments to participants. RBC Dexia liability benchmark helps complete the picture.
For more information regarding this product, please visit rbcdexia.com
About RBC Dexia Investor Services
RBC Dexia Investor Services offers a complete range of investor services to institutions worldwide, including Canadian pension funds. Our unique offshore and onshore solutions, combined with the expertise of our 5,400 professionals in 16 markets, help clients grow their business and sustain enhanced performance through efficiency improvements and robust risk management processes. Equally-owned by RBC and Dexia, the company ranks among the world's top 10 global custodians with USD 2.3 trillion in client assets under administration.
RBC Dexia Investor Services Limited is a holding company that provides strategic direction and management oversight to its affiliates, including RBC Dexia Investor Services Bank S.A., a credit institution licensed in Luxembourg by the Commission de Surveillance du Secteur Financier and the Ministry of Finance. All are licensed users of the RBC trademark (a registered trademark of Royal Bank of Canada) and Dexia trademark (a registered mark of Dexia Crédit Local) and conduct their global custody and investment administration business under the RBC Dexia Investor Services brand name.
SOURCE RBC Investor & Treasury Services
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