FSP merged with AP Pension in 2012. The authority also said it was ordering AP Pension to send out information to all former FSP members who had switched pension product, describing the background to the decision to award compensation. This should be done in the second quarter of 2014, it said.AP Pension said that at the time when customers had agreed to forgo their guarantees, all scheme members had been compensated equally. “But even though this was the practice, it was not necessarily reasonable,” AP Pension said.In order to make the division of reserves fairer in such situations, Finanstilsynet introduced so-called contribution groups – grouping people together based on age – at the start of 2011, the pensions firm said.But AP Pension said this had not been the case at the beginning of 2011 when FSP offered its customers the opportunity to switch from a with-profits pension product to a unit-linked one.As part of its discussions with Finanstilsynet over the issue, it said that in 2013 it had earmarked DKK131m including pension tax (PAL) for compensation. As a result of the latest talks with the regulator, it had now decided to compensate customers from the former FSP Pension with DKK170m including PAL, it said.Finanstilsynet said it has referred the case to the Council of Finance (Det Finansielle Råd).Many Danish pension funds, which are incorporated as life insurance companies, are trying to move customers with older with-profits pension products, which include yield guarantees, to non-guaranteed plans which carry lighter reserve requirements. Denmark’s AP Pension has been censured by the financial regulator for failing to pay enough compensation to some scheme members when they gave up their pension guarantees.The mutually-owned commercial pensions firm has agreed to pay DKK170m (€22.8m) to customers of the former Finanssektorens Pensionskasse (FSP). The members either relinquished their yield guarantees on with-profits pension plans when they took part in a product switching push in 2011, or when they moved their plan to AP’s unit-link product AP NetLink.The regulator, Finanstilsynet, said it had reprimanded AP Pension. In the product switching exercises for members of FSP Pension — which existed at that point — in 2011, 2012 and 2013, AP Pension failed to pay out the extra reserves for expected longer lifetimes, which had applied at the time, the regulator said.