Tags: Poland | seizing | pension | assets

Poland Seizing Pension Assets to Cover Deficit

By    |   Thursday, 10 Oct 2013 05:25 PM

The Polish government plans to nationalize $47.6 billion of government bonds held by private investment managers handling Poles' retirement money.

The government wants to take over the bonds to reduce its debt, though it presents the move as a mere accounting change that won't harm retirees, The New York Times reports.

It's the most serious nationalization since the Soviet Union existed prior to 1991, critics tell the paper. The government claims it's just a bookkeeping change and that the citizenry's retirement savings are safe.

Editor’s Note: 5 Reasons Stocks Will Collapse . . .

But the investment managers now handling the bonds, along with economists, labor unions and even senior members of the governing party are highly critical of the government's move, The Times reports.

"Poland has taken a significant step backward," David McMillan, chief executive of Aviva Europe, which manages a private pension fund in Poland, told The Times. "There is no doubt that the changes have increased the risk of investing in Poland."

While the government says pensioners aren't at risk, critics say taking the bonds away from the fund managers without paying them amounts to an asset seizure, according to The Times.

The government published a draft version of the legislation Thursday. The private pension funds must transfer 51.5 percent of their assets to the state in February, the draft says, according to Reuters.

The government will forbid the pension funds from investing in treasury and state-guaranteed bonds after assets are transferred to the government.

Editor’s Note: 5 Reasons Stocks Will Collapse . . .

Related Stories:


Poland Cuts Interest Rates to Record Amid Lack of Recovery Signs

RealClearMarkets: The Bull's-Eye for Govt Pension Shortfalls Is on Taxpayers

© 2017 Newsmax Finance. All rights reserved.

 
1Like our page
2Share
StreetTalk
The Polish government plans to nationalize $47.6 billion of government bonds held by private investment managers handling Poles' retirement money, in what critics call an asset seizure.
Poland,seizing,pension,assets
282
2013-25-10
Thursday, 10 Oct 2013 05:25 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved