The World Bank Group Net Plan Changes Effective May 1, 2007 Pension Administration Tel: (202) 458-2977 Email: [email protected]

The World Bank GroupThe World Bank Group

Net Plan Changes Effective May 1, 2007

Pension Administration

Tel: (202) 458-2977Email: [email protected]

2The World Bank GroupThe World Bank Group

World Bank Pension Administration April 2007

Staff Retirement Plan

Objectives for change Changes effective May 1, 2007 Plan design Voluntary Savings Component details How to enroll in Voluntary Savings Component Expanded pension option Cash Balance & Voluntary Savings investment

options Sources of Additional Information



Objectives for Change

Make the Plan more flexible Increase investment flexibility Expand opportunities to build retirement savings Improve eligibility for pension Create more of an employer/employee balance for

retirement income



Net Plan Changes – May 1, 2007

Increase Cash Balance Component investment options from 4 to 8

Add a new Voluntary Savings Component with 8 investment options

Provide an pension to employees who have five years of service and whose age plus years of defined benefit services equals at least 60

Allow monthly investment changes

IncreasedIncreasedExpandedExpanded

O P P O R T U N I T I E S



Net Plan Components

• Defined Benefit Component

• Cash Balance Component

• Cash Balance Component

• Voluntary Savings Component

A Balanced Partnership for Building Retirement Income

World Bank Employees



Voluntary Savings Component

Participants may contribute 1%-15% of net pay Eight investment options Option to change contribution percentage and

investment options monthly Contributions are after-tax Investments grow tax-deferred until distribution Account tracked in US dollars

ExpandedExpanded




Voluntary Savings Component

Account paid as lump sum upon retirement or termination of employment

Account paid to beneficiary upon death while an active employee

No tax supplement on Voluntary Savings Component U.S. tax qualified plan which provides for rollovers upon

termination Distribution paid in US dollars or currency of choice based on

spot exchange rate



Voluntary Savings Component - Enrollment



Voluntary Savings ComponentEnrollment



Voluntary Savings ComponentStatement



Voluntary Savings ComponentStatement



Defined Benefit Component– Pension Payment

Employees have asked for greater flexibility to receive an pension

New pension qualifications 10 years of benefit service or, 5 years of benefit service and age plus years of benefit service

equals 60

Example: change allows an employee hired at age 57 to receive pension payment if they work until age 62

IncreasedIncreased



Cash Balance Component– Investment Changes

Monthly investment changes Changes received by last day of the month effective first day of

following month. (Example: changes made by midnight April 30, 2007 will be reflected on May 1, 2007)

More investment options

ExpandedExpanded


Current Options1234

New Options1 52 63 74 8



Cash Balance & VS – Investment Options

Lower Risk Moderate Risk Higher Risk

Real 3%1,3

Lehman Brothers Government/ Credit Index1

Merrill Lynch USD LIBOR

Lehman Brothers2 U.S. TIPS Index

S&P 500 Index1

JP Morgan Emerging Market Bond Index Plus (EMBI+)

MSCI EAFE Index1

Russell 2000 Index

MSCI Emerging Market Index

1) Currently offered as investment options

2) Available in Voluntary Savings Component Only

3) Real 3% available in Cash Balance Component Only



Real 3%

Investment Objective – guaranteed return of 3% above inflation rate based on US Consumer Price Index

Calendar Year Returns

0%

1%

2%

3%

4%

5%

6%

7%

2002 2003 2004 2005 2006

Administration Fees: None

Risk Level

Low Moderate High

Real 3% Option available in Cash Balance Component only



Lehman Brothers U.S. TIPS Index

Investment Objective – Unmanaged market index comprised of all U.S. investment grade Treasury Inflation Protected Securities with at least one year to final maturity and at least $250 million per amount outstanding.


0%2%4%6%8%

10%12%14%16%18%

2002 2003 2004 2005 2006

Administration Fees: Annual fees of $10 per $10,000 in account value.

Risk Level

Low Moderate High

U.S. TIPS Option available in Voluntary Savings Component only



Lehman Brothers Government/ Credit Bond Index

Investment Objective – Provide a return based on U.S. Treasury obligations with maturities over one year, government-related issues, and investment grade U.S. Corporate issues.


0%

2%

4%

6%

8%

10%

12%

2002 2003 2004 2005 2006


Risk Level

Low Moderate High



Merrill Lynch USD LIBOR

Investment Objective – Track purchase of an instrument having 3 months to maturity with a coupon equal to the closing quote for 3-month LIBOR.


0%

1%

2%

3%

4%

5%

6%

2002 2003 2004 2005 2006


Risk Level

Low Moderate High



S&P 500 Index

Investment Objective – Track the return of the S&P 500 Index, which contains a representative sample of common stocks that trade on the NY and American Stock Exchanges and some over-the-counter stocks.


-30%

-20%

-10%

0%

10%

20%

30%

40%

2002 2003 2004 2005 2006

Administration Fees: Annual fees of $4 per $10,000 in account value

Risk Level

Low Moderate High



JP Morgan Emerging Market Bond Index Plus (EMBI+)

Investment Objective – Track return of traditional, market-capitalization weighted index comprised of U.S. dollar-denominated Brady Bonds, Eurobonds and traded loans issued by sovereign entities. Includes currency fluctuation risk.


0%

5%

10%

15%

20%

25%

30%

35%

2002 2003 2004 2005 2006


Risk Level

Low Moderate High



Russell 2000 Index

Investment Objective – Measures performance of the 2,000 smallest companies in the Russell 3000 Index, which is made up of 2,000 of the biggest U.S. Stocks.


-40%-30%-20%-10%

0%10%20%30%40%50%60%

2002 2003 2004 2005 2006


Risk Level

Low Moderate High



MSCI EAFE Index

Investment Objective – Track return of the Morgan Stanley Capital International Europe, Australasia, Far East Index, a free float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. Includes currency fluctuation risk.


-20%

-10%

0%

10%

20%

30%

40%

50%

2002 2003 2004 2005 2006


Risk Level

Low Moderate High



MSCI Emerging Market Index

Investment Objective – Measure equity market performance in the Global emerging markets through a free float-adjusted market capitalization index. Includes currency fluctuation risk.


-10%

0%

10%

20%

30%

40%

50%

60%

2002 2003 2004 2005 2006


Risk Level

Low Moderate High



Investment Funds – Average Annualized Returns

Investment Option 1 Year 3 Years 5 Years

Real 3% 6.38% 5.77% 5.57%

Lehman Brothers U.S. TIPS Index 2.74% 3.44% 7.22%

Lehman Brothers Government/ Credit Index 5.39% 3.27% 5.18%

Merrill Lynch USD LIBOR 5.32% 3.41% 2.67%

S&P 500 Index 11.97% 9.10% 6.82%

EMBI+ 7.88% 11.61% 14.12%

Russell 2000 Index 9.87% 11.95% 12.44%

MSCI EAFE Index 21.57% 19.53% 16.88%

MSCI Emerging Market Index 17.39% 26.84% 25.31%

Historic performance is not necessarily indicative of actual futureinvestment performance, which could differ substantially



Additional Resources

Pension and Retirement Information website Investment Fact Sheets Voluntary Savings Component description Voluntary Savings Component Account Statements Basic Investment Guidelines FAQ’s

Information to come Staff Retirement Plan Highlights Brochure Enhancements to Retirement Planner



Additional Questions

X82977 Pension Information Line: (202) 458-2977 Email: “Pension Administration”

An Employer/Employee Partnership

Documents

The World Bank Group Net Plan Changes Effective May 1, 2007 Pension Administration Tel: (202) 458-2977 Email: [email protected]