Deals and People May 18, 2012

Rowe Joins DCAdvisors' Leadership Team

May 18, 2012 (PLANSPONSOR.com) - DCAdvisors has appointed John Rowe to its client consulting group and leadership team.
 
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Rowe, who has worked in the industry for 30 years, is an expert on the use of lifetime income solutions within target-risk and target-date investment strategies.  His professional experience includes senior leadership roles in business development, client management and product development while working at American Express (now Ameriprise), Merrill Lynch, Genworth and MetLife.    

“John’s experience with institutional investments and his industry knowledge will be immensely valuable to our clients as we advise retirement plan sponsors on the new 408(b)(2) and 404(a)(5) fee transparency requirements, design appropriate risk mitigation strategies, and deliver enhanced service provider and investment menu benchmarking services,” said Dan Esch, managing director of DCAdvisors.

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Rowe earned a bachelor’s degree in finance and economics from Ball State University.

Jay Polansky

Administration May 18, 2012

Group Offers Guidelines for Public Pension Disclosure Obligations

May 18, 2012 (PLANSPONSOR.com) – The National Association of Bond Lawyers (NABL) has published guidelines for state and local government disclosure obligations when offering bonds to the market.
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The document notes the overall point of the disclosure of pension funding obligations is to indicate whether the state or local government will likely struggle in meeting such obligations without making difficult financial decisions.  One of those decisions may be related to the payment of debt service on bonds.  Thus, in circumstances when an issuer’s pension funding obligations are expected to cause financial strain, being clear and plain about this point to investors is very important.    

According to the document, plans should disclose two principal types of information: (a) the current financial information about the plan’s assets and financial activities, and (b) the actuarially determined liabilities of the employers that provide benefits through the plan, including information about the funded status of the benefits provided through the plan, the history of its funded status and the plan’s progress on accumulating assets to pay benefits when due.  

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“Pension funding obligation disclosure is not ‘one size fits all’ and the story of one issuer will be different from other issuers,” the guidelines say. The guidelines list documentation and key questions that are important to an analysis of what disclosure about an issuer’s pension funding obligations may be required in a particular instance.

The guidelines were established by a Pension Disclosure Task Force (PDTF), which included members of NABL, and representatives of issuers, underwriters, analysts, institutional investors, accountants, actuaries and other interested parties.  

In 2010, the Securities and Exchange Commission (SEC) charged the State of New Jersey with securities fraud, saying it did not provide adequate and full disclosures to its bondholders (see “Running the Fund: Jersey Sure?”).  

Since then, the SEC has also investigated disclosures in Illinois (see “SEC Probing Illinois Pension Accounting and Disclosures”) and Rhode Island (see “SEC Looking into RI Bond Transactions”).  

The PDTF recommends issuers, their counsel and other members of the financing team give due attention its list of considerations in making the determinations as to what disclosure and reasonable investigation is appropriate in a particular instance.    

The document is here.

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