Staff pension plan
All 578 employees of our corporate Group who work in Liechtenstein are covered by the retirement, life and disability insurance plans of the independent Personnel Pension Fund Foundation of LLB AG. Our pension fund and its defined-contribution scheme offer all insured persons an attractive savings plan that goes beyond the requirements of the law (BPVG). In addition, LLB as an employer makes contributions of two thirds to the financing of the fund. The Personnel Pension Fund takes its responsibility seriously of securing and increasing pension plan assets in the long-term and has chosen a secure and balanced investment strategy.
As at the end of December 2014, the liquidity ratio stood at 110.8 percent (2013: 107 %) and had consequently improved by 3.8 percent on the previous year. The value fluctuation reserve stood at CHF 27 million, which is about 68 percent of our target goal. This is mainly due to a good return on investment of 6.5 percent. The pension plan assets amounted to over CHF 275 million. There was a ratio of four actively insured persons to one retired person. In 2014, the technical interest rate remained unchanged at 2.5 percent. The pension conversion rate, which converts retirement assets upon retirement at the age of 64 into a pension, amounted to 5.6 percent. The accumulated capital bore interest at 2.75 percent.
The Personnel Pension Fund Foundation of LLB AG was able to strengthen its liquidity ratio and now has a high risk capacity with which it can very easily manage fluctuations in assets.
The main challenge is to ensure financial stability against the backdrop of low-level interest rates and volatile investment markets. Pressure to further decrease the technical interest rate and, as a result, the conversion rate will continue to grow along with increases in life expectancy.
The Board of Trustees of the Personnel Pension Fund Foundation of LLB AG decided to make various changes to the pension plan as per 2014. The insured annual salary now comprises the agreed total remuneration, that is, the fixed annual income plus a target bonus. LLB is consequently able to ensure the continued existence of a financially sound and attractive pension scheme for all employees.