ABN Amro aims to offer a service to pension fund sponsors which will guarantee to eliminate scheme deficits over a 10-year period.

Keith Jecks, global head of pensions strategy, said: "The service would protect sponsors from market volatility and a range of other risks. It should be cheaper for sponsors to use our service than make good deficits on their own." He said stress testing on the impact of extreme market conditions on the service was being carried out. He said: "We hope to go live before the end of the year." ABN Amro is the latest entrant into the pension buyout and guarantee market. On September 25, Financial News revealed Goldman Sachs and Edmund Truell's Pension Insurance Corporation were close to entering the pension fund buyout market. Truell said he had raised £1bn (€1.48bn) in equity funding last week. Mark Wood's rival Paternoster operation made its first pension buyout in August and should soon complete another. Isabel Hudson's Synesis is also up and running. Wood and Hudson used to work for Prudential, the UK's largest buyer of mature schemes. Its former chief executive, Jonathan Bloomer, is a director of private equity firm Cerberus Capital Management, which recently backed new US pension buyout operation Retiree Benefits. Industry sources say Bloomer and Cerberus have considered backing European buyouts. Both declined to comment. Independent insurance analyst Ned Cazalet said deals totalling £40bn will be finalised by 2010. ABN Amro is a shareholder in Pension Insurance Corporation But Jecks said his proposed service would not conflict with it. He said: "Some sponsors will be interested in an immediate buyouts. Others will want to glide towards one using our service." Under the ABN Amro plan, schemes would be put within a special purpose insurance vehicle. Sponsors would top up a scheme and pay ABN Amro an insurance premium. ABN Amro would take control of asset allocation and would be allowed to inject capital to secure a decent return, with the help of gearing.