Much ado about little

A proposal to allow Denmark's pension funds to value liabilities using swaps rates is being considered by the country's regulator. Some claim the new rules will lead to a shrinking of liabilities, although Denmark's biggest funds say these fears are exaggerated. John Ferry reports

Denmark's pension industry could be about to undergo a shake-up in the way liabilities are calculated. In January, the country's insurance and pension fund industry trade body, Forsikring & Pension, sent a letter to the Danish Financial Services Authority (FSA) asking that current rules on the marking-to-market of pension liabilities be changed. Rather than using a discount rate based on government bond yields, Forsikring & Pension proposed the use of local swaps rates instead.

At the moment, it