€8.7bn pension transfer

AN €8.7 billion British pension fund is being transferred to Dublin following new legislation aimed to attract funds to the country.

Although the identity of the pension fund is not known, the move to Dublin will be a boost to the funds management industry, which is principally based in the International Financial Services Centre.

The move comes less than two months after the Government brought in legislation to make it easier to set up Common Contractural Funds.

This allows companies to pool their funds together in one location, reducing management fees, administration costs and custodian fees. The funds are particularly helpful to multinationals who have many pension schemes spread across several countries. The pooling also allows smaller funds to diversify their risk over more managers.

Although €8.7bn is small in the contest of the hundreds of billions being managed in IFSC-based funds, the move is indicative of the possibility for more funds to re-domicile in Ireland.

A number of major companies, including Nestlé, were reported last year to be interested in setting up CCF funds here.