ABN AMRO pension fund aims to provide the best pensions possible. However, if the financial situation deteriorates, the only solution may be to reduce the pensions. This reduction will then apply both to the pensions in payment and the pensions still being accrued. The reduction of pensions is also referred to as a pension cut. Our reduction policy applies to the base pension arrangement and not to the net pension arrangement.

The financial position is determined on the basis of the policy funding level <link to glossary> and the required own funds. These are subject to statutory rules.

The board of ABN AMRO pension fund has set out guidelines for pension reductions.

Guidelines:

  • If the policy funding level is lower than the funding level corresponding with the Required Own Funds, the board can reduce the pensions. The reduction is spread over a ten-year period until the funding level is back at the required level. Proposed reductions are reviewed each year to see whether they are still necessary. The proposed reductions are updated each year in a ten-year recovery plan.
  • If the policy funding level is lower than the funding level belonging to the Minimum Required Own Funds and the board does not expect this situation to be remedied within five years, it can spread the pension reduction over a five-year period until the funding level is back at the required level.
  • If the financial situation improves, the board can decide to compensate the pension reduction. This, however, is not an obligation.

    The board can change the policy or deviate from the above guidelines if circumstances so require. For instance, to comply with regulatory changes or to protect the interests of the beneficiaries.