APS remains positioned for the future amidst complex financial environment
Cayhill, Sint Maarten, October 2, 2023: In its annual report for the fiscal year 2022, the General Audit Chamber of Sint Maarten clearly outlines the challenges faced by APS. Nathalie Tackling, Chairperson of APS, states, “As a board, we are acutely aware of the responsibility we hold towards the pensions of our participants. We are operating in a complex and dynamic landscape. On the one hand, we are revisiting decisions made in APS’s early stages concerning local investments. On the other, we must manage an international investment portfolio that saw negative returns in 2022 due to global economic conditions, including the war in Ukraine and unprecedented inflation.”
Since its inception on October 10, 2010, APS’s international investment portfolio has seen an average return of 5.41%, closely aligning with its target average return of 5.5%.
Performance Reassessment
Nathalie Tackling elaborates, “APS is committed to regular performance reviews of our fiduciary manager. A new evaluation is on the horizon, benchmarking our fiduciary manager against sector peers. The objective remains clear: to generate optimal returns within an acceptable risk parameter for our beneficiaries.”
Restructuring Local Investments for Improved Outcomes
"Investing locally has always been an integral part of APS's mission, but it's a mission that has faced numerous complexities, from bureaucratic roadblocks to fluctuating construction costs. While some of the choices made in the past may not mirror today's circumstances, we view this as a call to action rather than a setback," states Nathalie Tackling.
"To adapt to these changing landscapes, we've undertaken a substantial structural transformation. We've not only built upon but fine-tuned the vision of the previous board to create a specialized entity—the Sint Maarten Investment Company (SMIC). This newly minted body is laser-focused on aligning our local investments with current and future market conditions.''
Louisian Wathey, the Executive Director of SMIC, commented, "My extensive background in credit assessment and risk management for various local banks has equipped me with an understanding of the market's evolving needs. Under the umbrella of the Sint Maarten Investment Company, we aim to tap into viable and lucrative projects that meet APS's stringent investment criteria, balancing strong returns with minimal risk. We are not only investing funds but we're also securing the financial futures of our participants.''
Approved Recovery Plan
Although 2022 presented less-than-ideal investment outcomes, affecting the Fund’s coverage ratio, APS has proactively designed a recovery plan. This plan has received approval from key governmental stakeholders including the Minister of General Affairs, the Minister of Finance, as well as the Central Bank of Curaçao and Sint Maarten (CBCS). The recovery plan shows promise in restoring APS’ coverage ratio to levels above 100% without additional measures.
Board & Audit Milestones
The board is delighted to announce that APS has received a clean audit report for the first time since its establishment in 2010. "This is an achievement we can be proud of," says Tackling. Another positive development is the strengthening of the board with the appointment of Robert-Jan James, nominated by the Bond for Retirees of the Netherlands Antilles (BGNAA), effective August 17, 2023. "The appointment process is comprehensive, involving statutory expertise requirements, screening by the VDSM, and approval by the CBCS. With one more board seat vacant, we look forward to the potential appointment of a candidate proposed by the CCSU, for whom the vetting process has already begun," adds Tackling.
Strategic Leadership
"These management changes signify a strategic recalibration designed to equip APS with the acumen and agility needed to navigate an increasingly complex financial environment. With a fortified board and imminent leadership adjustments, we're not just preparing for the challenges ahead—we're actively shaping the future of APS," concludes Nathalie Tackling.
