Dutch pension fund Pensioenfonds Metaal & Techniek, The Hague, Netherlands, said Friday it is shifting its administration for more than 1.4 million plan participants to PGGM away from MN in an effort to cut costs.
The announcement follows changes in the Dutch pension market that would see a shift of retirement assets into pure defined contribution plans from defined benefit and collective defined contribution plans by 2027.
The new pension regulation that will require a switch to DC is expected to be passed by the Dutch Senate at the end of May or in early June.
As a result, many pension funds will be required to overhaul their record keeping.
The investment management of PMT's assets will remain with MN. PMT had €77.1 billion ($83.9 billion) in assets as of March 31.
"It is of great importance to PMT that the service to our participants and employers is optimal, both in terms of quality and cost control. We are convinced that PMT will benefit from this in this new situation," said Terry Troost, PMT's employer chairman, in the news release Friday.
PMT, PGGM and MN are also exploring a joint administration company that would be launched in 2024.
As a result of the record-keeper switch, MN employees who now manage PMT's administration will be employed by PGGM in a new company in Zeist and The Hague.
The firms are expected to sign a contract later this year, a PGGM spokesman said. "We need this workforce because the transition to a new pension contract is quite labor consuming," he said. PGGM wants to be ready to implement the new administration capabilities for its clients in 2026, he added.
Edwin Velzel, CEO of PGGM, added in the news release: ''PGGM is well on track to introduce the new pension contract for our existing clients in 2026. The increased effectiveness of the combination with MN reinforces our ambition to be a leading party in excellent customer service in the Dutch pension landscape. This is therefore a major strategic step for us."
PGGM is also the in-house investment manager of second largest Dutch pension fund, Pensioenfonds Zorg en Welzijn, Zeist, Netherlands, which has €217.6 billion in assets.