Eric Viet quits JP Morgan to launch pension buy-out fund

The fund, which is currently unnamed, will target UK and US firms with significant pension asset and liability positions relative to their market capitalisation. Levillain explained that it would be considering alternative approaches to the traditional insurance bulk buy-out solutions, although he declined to go into further detail.

"Regulatory pressure and issues, such as accounting rule changes, mean that firms are devoting more and more time to managing their pension schemes, which is a drain on their resources and an impediment to corporate activity, such as restructuring and dividend distribution," said Levillain. The fund sees many opportunities to strip out pension assets and liabilities from corporate balance sheets, which it can then actively manage independently.

Levillain, who while at JP Morgan was responsible for structuring Vivendi Universal’s liability-driven investment solution that won the French firm Risk magazine’s ‘corporate end-user of the year’ award in January 2006, adds that the fund aims to manage around £10 billion of liabilities by 2008.

"We believe that is a lot of scope for significantly improving the management of pension funds, in terms of both cost, as well as asset and liability management. Our aim is to create a low-cost aggregator of pension obligations thanks to economies of scale, mutualisation of risks and efficient operations," he said.
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