Private pension funds in Romania reach EUR 13 bln in assets

The net assets (NAV) of the voluntary private pension funds rose by 21.3% year-on-year to RON 2.47 billion (nearly EUR 0.5 bln), at the end of November, according to the Financial Supervisory Authority (ASF) data quoted by Agerpres.

Meanwhile, the mandatory private pension funds boasted cumulative net assets in excess of RON 60 bln (EUR 12.5 bln) after an annual increase of 26.5%.

The rise in the NAV reflects a multitude of factors including the new contributions and the yield of the investments made by the fund managers.

Employees currently contribute 3.75% to the mandatory private pension funds (fully deductible) while only EUR 400 per year (some 3.1% of the average gross wage) can be deducted as contributions to the voluntary pension funds.

The private pension funds invested more than half of their money in public debt and 20%-25% in equity.

Speaking of the voluntary private pensions, the government securities held the highest share in the assets, 56.6%. Equity accounted for 25.5%, followed by corporate bonds with a share of 8.43% of the total assets. The mandatory private pension funds followed a more cautious investment strategy: 61% of their assets are placed in state debt, while the equity accounted for 22.5%, followed by corporate bonds (7%).

(Photo: Adobe Stock)