Deals & People March 10, 2010

Baden Expands Reach of TPA Solutions

Baden Retirement Plan Services (Baden), an Ascensus company, is rolling out its services nationally through Ascensus’ sales force of 12 regional vice presidents (RVPs).
Reported by

According to the firm, the sales and marketing effort has been initiated by three RVPs whose territories cover 16 Midwest states:

  • Anthony Bologna: Illinois, Michigan, and Wisconsin;
  • Ted Samsel: Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, Oklahoma, North Dakota, and South Dakota;
  • Rob Shwab: Indiana, Kentucky , Ohio, and West Virginia.

The firm said that, with the support of Baden’s compliance-only services, the RVPs can provide financial advisers and their clients with access to customized 401(k) and other retirement plan solutions including insurance products and mutual fund investment options. The RVPs will also continue to provide access to full-service retirement plan solutions through Ascensus’ suite of products.

Baden Retirement Plan Services, an Ascensus company, is a third-party administrator with a primary client base in the Midwest. 

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The Markets March 10, 2010

DC Participants Sought More Risk in 2009

Throughout much of the 2009 market rally, activity as measured by fund flows within the Callan DC Index, was above average as participants sought to increase their exposure to risky assets.
Reported by

Nearly 5% of money flowed out of stable value funds in 2009, compared to inflows of nearly 17% in 2008, Callan said. In the fourth quarter, money continued to flow into most equity funds and out of capital preservation vehicles such as stable-value and money-market funds. However, the pace of turnover for the quarter declined to 0.57% (below the historical average).

Target date funds were a major recipient of inflows during the fourth quarter, and have seen inflows every quarter since the Index’s inception—including throughout the market collapse, Callan noted.

Target date funds account for more than 10% of DC assets and are represented in 75% of DC plans. For plans with target-date funds, target-date assets average 19% of the total.

Stable-value funds account for 16% of assets, down from more than 18% going into 2009. However, despite positive flows and the market rally, the Index’s equity exposure has not returned to pre-market collapse levels. The average plan has about 63% in equities, down from a high of 70.5% in December 2007.

The average DC plan rose 22.22% in 2009, helping to offset the 28.5% decline in 2008, according to Callan.

The index’s recent strong performance means that DC participants are in the black for the first time since the third quarter of 2008. Going into 2009, the value of DC Index assets had shrunk by 2.16% on an annualized basis since inception, despite an annualized contribution rate by plan sponsors and participants of 3.06% during that same period, according to Callan. By the end of 2009, balances of participants in the Index experienced a growth rate of 4.34%.

However, Callan said much of this increase (3.33%) comes from contributions, with only 1% attributable to actual total return.

The Callan DC Index is available here.

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