On Tuesday, the group submitted its proposal to the Private Pension Supervision Commission (CSSPP) to form a company to manage second pillar pension funds, with a 10 million-euro investment earmarked for the new company, explained Ian Harrocks, general manager of the group's insurance company, KD Life.
"There are companies on the market that decided against the management of private pensions. We thought long and hard whether to enter this market or not, as the legislation on private pensions was very unclear," stated Ian Harrocks, who explained why the company initiated formalities for managing mandatory pensions just one month before the start of the system, which is scheduled for September 17.
The current deputy manager of KD Life, Carmen Radu, will run the new pension company. Harrocks estimates the number of clients who sign mandatory pension contracts with the company will reach 100,000 by yearend. "The pension company's capital could be increased to 15 million euros next year. Within 5-6 years, the company will be able to step into the black, and the initial investment will be recouped in about 8 years," believes the manager of KD Life.
Out of the 10 million euros earmarked for investments in the pension company, 2 million will be allocated for an advertising campaign.
At the beginning of next year, KD Life will submit to the CSSPP its proposal to secure a manager licence for voluntary pensions (the third pillar).
"I think voluntary pensions are more important than mandatory ones for clients. In terms of profitability, in comparison, I believe that the voluntary pension business will become profitable at a faster rate, but this largely depends on sales volumes," says Harrocks.
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