Behind every corporation that wants to reduce pension plan risk is a good insurance company. Gary Knapp, Newark, New Jerseybased head of liability-driven strategies for Prudential Fixed Income, drives Prudential Financials efforts to help corporate clients implement such de-risking on their own balance sheets. Knapp, 54, also works with Prudential to move those liabilities to the insurer as a group annuity. Last year, in the two biggest-ever such U.S. deals, General Motors Co. and Verizon Communications chose Pru to take on part of their pension risks. Knapp, who jokes that his personal brand is matching assets to liabilities for 28 years, started an asset management group to implement liability-driven investing strategies for corporations back in 2006, after the Pension Protection Act took effect. For the first time, companies had to think about splitting up their pension portfolios, he recalls. Pensions are increasingly seen as a division of their sponsor, says Knapp, who has an MS in mathematics from Brown University. As such they are beginning to be viewed as sources of enterprise risk and to play a role in credit ratings and M&A. After starting at Pru in 1985, Knapp built the first asset-liability model for traditional life insurance. In 1993 he moved to the firms corporate risk management department, where he developed the first value-at-risk models for insurance and annuity liabilities.
< 29. Pat Quinn | Back to Article | 31. Gregory Floyd >