Private pension companies from TOP 3 started off with different investment strategies
The three largest mandatory private pension funds (Pillar II) from the market started to invest their clients’ money based on different strategies, also taking advantage of the derogation adopted by CSSPP at the very last minute and allowing, for the first six months, to place any percentage of the assets in bank deposits, according to a study conducted by the portal www.pensiileprivate.ro. The first money (EUR 24.1 million) went into the pension funds’ accounts on the 20th of May, and the funds have already started to invest it.
ING and ALLIANZ-TIRIAC used the Commission’s derogation and invested the largest part of the assets in monetary market instruments, which provide for high returns at the moment, because of the inflationist conditions and the interest rates on the monetary market. On the other hand, GENERALI, that administers the only pension fund with a high risk profile on the market, already aligned its investments with the limits provided for in the prospect.
ING has already notified CSSPP and the participants to the fund (by an ad posted on the pension company’s website) about its intention to use the six-month derogation, when funds can invest any amount of their assets in monetary market instruments, said Radu VASILESCU, CEO of ING Pension Fund. According to the law, the ceiling for monetary market investments is a maximum 20% of the assets, but the norm adopted by the Commission grants a six-month derogation from this upper limit.
ALLIANZ-TIRIAC adopted a similar strategy, benefiting from the Commission’s derogation to strengthen its investment targets in due time. “We build our positions in time, with a prudent attitude. We don’t want to go in with all the money at once and thus drag the market after us, as there is a chance for this to happen, theoretically”, stated Dorin BOBOC, investment director at ALLIANZ-TIRIAC Private Pensions.
He says that the derogation granted by the Commission adds a break until the full application of the investment policies followed by the funds through the issuing prospects. Moreover, because of the high inflation and interest rate of the monetary policy on the market, the monetary market instruments generate sufficiently high returns at the moment, for a start, stated BOBOC. As for diversification of investments and introduction of all instruments provided for in the prospects, it shall be built during the period of applying the derogation from these limits.
"The derogation adopted by the Commission in the norm is beneficial, but it’s not exactly what we wanted", says BOBOC. "We proposed the Commission a one-month derogation from the legal investment limits and from the prospect, for one year. This means that before any new transfer of contributions, each fund was supposed to have its investments within the prospect limits. This would give each fund one month to diversify the investments and align more quickly and more efficiently to the prospect, than the six-month solution selected by the Commission", stated the investments director of ALLIANZ-TIRIAC Private Pensions.
GENERALI, the market’s third largest fund, chose to play aggressively from the very beginning and has already diversified the investments within the prospect limits. “We have already invested 30% of the assets in stock listed at the Stock Exchange. And the other investments are made within the prospect limits. We did not consider it necessary to notify the Commission in order to enjoy the six-month derogation. We positioned ourselves as the most dynamic fund on the market, the only one with a high risk profile, so we decided to invest from the very beginning just like we promised the participants, within the limits provided for in the issuing prospect”, stated Anne-Marie MANCAS, investment director of GENERALI Pension Fund.
According to her estimations, the mandatory private pension market might reach a level of EUR 250-300 million assets by the end of this year.
