Regulatory Alerts2018-03-31
PF Circular 64: Amendments to the Pension Funds Act under the Financial Institutions Amendment Act of 1986
The Registrar of Pension Funds issued PF Circular 64 to mandate compliance with the Financial Institutions Amendment Act of 1986, which significantly revises the Pension Funds Act. The circular requires distressed funds to submit recovery schemes within three months, expands valuator reporting duties, and strictly regulates member mortgage loans by setting a 15 percent prescribed interest rate, extending repayment terms to 30 years, and raising loan-to-value limits to 90 percent or 100 percent with employer guarantees. Additionally, pension funds must amend their governing rules to align with the new legislation, while the Registrar is empowered to prohibit irregular business practices and enforce increased penalties for statutory contraventions.