George Town, Grand Cayman, 8 December 2022 - Members of the Cayman Islands Chamber of Commerce Pension Plan met at their Annual General Meeting on 7 December. Those presenting at the meeting included Chamber Pension Chairperson Giosino Colaiacovo, Mercer Investments LLC partner Amy Labanowski, and PricewaterhouseCoopers auditor, Andrew Shannon.
More Members & Lower Expense Ratio
Despite a challenging year for the global economy, the Chamber PensionPlan managed to successfully conclude another year of operations, with membership increasing by approximately 1%, totalling over 16.3K current members.
Additionally, the annual all-in-expense ratio decreased from 0.80% to 0.75% for the financial year ended 30 June 2022, meaning lowered expenses and increased returns thanks to the expertise of the Plan's established investment advisers in conjunction with the efforts of the volunteer Board of Trustees.
Performance & Global Market Volatility It was also reported that due to this year's market volatility(1)and the pension holiday imposed by Government since 2020(2), the Plan's total assets decreased by approximately 12% compared to the prior year, with a total investment portfolio of KYD$336.09Million at June 30, 2022.
Administrator Agent Update As of 1 March 2022, the Plan changed the Administrator’s Agent from MUFG Fund Services (Cayman) Ltd. to Saxon Administration Ltd. and Intertrust Group. The Board chairperson, Mr. Giosino Colaiacovo said the Plan was pleased with the excellent services provided by Saxon Administration Ltd., and Intertrust Group. Mr. Colaiacovo pointed out that the service improvement included a superior customer service call back feature, faster response time, an enhanced customer online portal, which was reconstructed to include enhanced features and streamline member statements; and a streamlined redemptions and payments process which has replaced drafts with local cheques, thus reducing wait time. Board of Trustees Last year, Mr. Giosino Colaiacovo was reappointed as one of the two Chamber of Commerce appointed Trustees. The Board is pleased that Mr. Colaiacovo has accepted a second term and looks forward to his continued expertise and knowledge. Mr. Colaiacovo is the Chair of the Board of Trustees and has served in this capacity since April 2020. The Board’snext anticipated changes will be in November and December 2023, when 7 Board members' terms will expire, and 3 of the 7 individuals will be required under the current Trust Deed to step down from their trustee roles. Those persons are as follows: Bradley Kruger, Paul McGeough, Grant Hiley. "The Board of Trustees would like to thank them for their diligent work and dedication during their tenure. Your individual and collective contributions will not be forgotten", said Mr. Colaiacovo. -ENDS - For more information about the Cayman Islands Chamber of CommercePension Plan or what is coming in 2023, visit chamberpension.ky or its Facebook, LinkedIn or Instagram sites, email admin@pensions.ky or call 745-7630.
Background
The Cayman Islands Chamber of Commerce Pension Plan was established on 12 May 1992. The Plan is a non-profit pension plan, committed to providing independent governance, transparent operations, and competitive, conservative risk-adjusted returns.
1. Update on MarketVolatility from Mercer
The third quarter of 2022 was another weak quarter for financial markets with most asset classes performing badly on the back of still high inflation and the related tightening of monetary policy across the globe. Global equities fell 6.1% in the third quarter taking year to date losses to 25.1%, close to the worst first nine months of the year on record. Bond yields rose sharply in most parts of the world with a number of central banks, including the US Federal Reserve, saying they intended to take interest rates to contractionary levels to ensure a period of slow economic growth. US 10-year bond yields are now nearly at 4% for the first time since 2010, while UK gilt yields rose even more dramatically.
Global economic growth remained soft in many parts of the world.
While there were some welcome signs that global labour markets might be loosening, they remain very tight and are putting upward pressure on wage growth in the US, UK, and some other countries.
In Europe, electricity and gas prices soared to many times normal levels as natural gas flows from Russia continued to slow.
Headline inflation remained at very high levels in most countries. However, there were some tentative signs that inflation might have topped, especially in the US, although it remains unclear when inflation will return to normal levels.
We expect global economic growth to remain soft for the next few quarters as most central banks, especially in the developed world (ex Japan)raise interest rates to intentionally lead to a period of sub-trend growth with the goal of loosening labour markets and thus wages and inflation.
The outlook for inflation and its impact on Fed policy likely will remain the key driver of the markets’ direction. The drag likely will intensify into 2023, increasing the risk of at least a mild recession in the US. The good news is that household balance sheets remain strong, which should cushion household spending and prevent a deep downturn.
Lastly, the Russian-Ukraine conflict, European energy crisis, and China’szero-COVID policy and real estate crisis, continue to be risks to global growth.
Read full report here: https://www.chamberpension.ky/post/mercer-recent-market-volatility
2. Update on PensionsHoliday
The pension holiday came to an end on 30 September 2022. Employers, employees and self-employed persons have once again resumed mandatory pension contributions as required by the National Pensions Act. The deduction of pension contributions commenced with earnings for October 2022 and the payment of a mandatory 10% pension contribution was due by the 15th of November and thereafter every month going forward.