The pension to be achieved is the pension you could accrue if you continue working with ABN AMRO Bank until your retirement age. The pension to be achieved is calculated based on your current details, including your salary. 

A pension benefit paid out by the government. If you live or have lived in the Netherlands, you are entitled to this pension upon reaching the AOW state pension retirement age. You start accruing AOW 50 years before reaching the AOW state pension retirement age. For example: your AOW state pension retirement age is 66. You will accrue AOW between age 16 and age 66. For each year you were living or working in the Netherlands, you accrue 2% of AOW state pension. This means you accrue 100% of your AOW benefit over the 50-year period. If you are living or working abroad for a number of years, you are not accruing AOW state pension on those years. More information about AOW can be found here.

The objective of a CDC Scheme is to accrue a specified pension sum with a
fixed pension contribution from the Employer. If the contribution is not sufficient to accrue
the future pension sum, this can be reduced by the Pension Fund. The Employer is never
obliged to pay more than the fixed pension contribution. Nor is the Employer obliged to
make an additional contribution if the Pension Fund has a Reserve or Funding Shortfall.
This may compel the Pension Fund to reduce Pension Entitlements or Pension Rights.

This gives an impression of a pension fund’s financial position and is expressed as a percentage. The funding ratio is calculated by dividing the pension fund’s assets available by the value of the pensions to be paid out. At a funding ratio of 100%, the pension fund has exactly enough money to pay for the accrued pensions, now and in the future.

The feasibility test is a test with which pension funds must check 1. whether they can achieve their pension ambitions with their investment policy and 2. whether the incurred risks correspond with the risk appetite. It is a forecast for 60 years.

The Pensions Act stipulates that a pension fund may only index the pensions if it expects that this indexation can continue to be granted into the distant future. We call this future-proof indexation.

This funding level is the limit above which a pension fund is permitted to grant full indexation.

Money devalues annually because prices go up. This is called inflation. The pension you accrued will therefore also be worth less every year. ABN AMRO Pension Fund aims to annually adjust the pension to price increases in the previous year. This is called grants or indexation.

Indexation is the adjustment of pensions to price increases. ABN AMRO Pension Fund tries to adjust the pensions each year on 1 April to the price increases in the previous year. The price increases are determined on the basis of the consumer price index - all households (CPI), as published by Statistics Netherlands (CBS).

The purpose of the matching portfolio is to earn just the amount of money as the value of the pensions we will be required to pay out, now and in the future. The value of the pensions changes due to interest rates. The risk of the investments in this portfolio is limited. We invest in bonds and interest swaps.

The lower limit of the required own funds. If the amount of required funds is lower than this level, the pension fund has a funding shortfall.

The statutory calculation rules that pension funds are required to use with effect from 1 January 2015 to calculate their financial position.

The component of your salary that does not count in pension accrual. You will receive AOW state pension later, so you do not need to accrue pension on your full salary. The threshold amount, the offset, is derived from the AOW state benefit amount. The offset amounts to € 13.785 in 2019.

Indexation to compensate missed indexations or reductions in existing and future pension rights in the previous year or years.

A pension is also arranged for your children upon your death. Each child will have the orphans’ pension up to the month of his/her 21st birthday. The orphan’s pension per child amounts to 20% of the partner's pension. It is paid out to each child, foster child or step child born before your termination of employment. 

Your partner is the person you are married to or have a registered partnership with. A number of conditions apply if you cohabitate: 1. Your partner is not married to someone else, and is not someone else’s registered partner. The same applies to yourself. 2. Your partner is not a blood relative or family in the direct line. 3. You have executed a cohabitation deed with your partner before a notary public. 4. You and your partner have been registered at the same address at least six months before your death. 5. Your partner is registered with us before your retirement.

The pension that is paid out to the surviving partner on a monthly basis from the first day of the month after the participant’s death until the partner’s death.

Pension commutation is not possible from 2019 onwards. If your pension rights are lower than the commutation limit (484,09), your pension rights will be transferred to the pension fund or insurer of your new employer. As this is regulated legally, you do not have to initiate the transfer yourself. You cannot object to the transfer either. If you do not have a new employer within the year you stopped accruing pension rights at our fund, we will try to transfer your pension rights the next year. We do this for five years. After these five years, we will commutate your pension if you agree upon it. After these five years, we will commutate your pension if you agree upon it.

This funding level is based on the average of the funding levels over the past twelve months. The value of the liabilities is calculated on the basis of the interest rate term structure as set by DNB (the Dutch central bank).

The prudent person rule stipulates that pension funds must invest the pension capital in the interests of their existing and future pension beneficiaries.  The rule consists of three pillars: investment policy, risk management and governance.

The recovery plan sets out the measures with which the pension fund expects to return to the Policy Funding Level corresponding with the Required Own Funds within 10 years + the required level of the Minimum Required Own Funds (if we are below the MROF) within five years.

The required own funds is the amount of funds that a pension fund must at least hold.

The purpose of the return portfolio is to earn so much money that we are able to annually raise the pensions (indexation). The risk on these investments is higher. We invest in shares, property and corporate bonds.

The investment risks that the pension fund is prepared to take to achieve the objectives.