9/2/2009
By Sophie Baker
The Second Swedish National Pension Fund/AP2 has recorded a sharp fall in its market worth for 2008, amounting to a return of -24 per cent on net assets.
The return value, SEK -55.1bn, meant the Fund's capital assets totalled SEK 173.3bn at the end of December 2008, and had a net inflow of SEK 0.9bn. The capital asset value was SEK 54.2bn lower than in 2007.
The drop has been attributed primarily to the decline in the world's stock markets, with a return of -24.0 per cent on the total portfolio.
"This is without doubt one of the most serious financial crises since the 1930s," commented Eva Halvarsson, CEO of the Second AP Fund. "In spite of deciding to reduce risk in the equity portfolios under in-house management, to reduce the scale of our positions in fixed-income and exchange-market securities and to cancel a number of investment strategies completely, the decline in market worth was still substantial."
However, AP2 has softened the blow with news that this fund only accounts for three per cent of the Swedish pension system's total capital assets. Equities comprise only seven per cent.
"This means that we can adopt a long-term strategic approach, and we have chosen to retain a high proportion of equities. This ensures that we are well positioned to benefit when the market stages a recovery. It is important to remember that our mission as a fund manager extends over a very long period," Halvarsson concluded.
Other stories you may find of interest:
Germans require education on pensions – Fidelity
Many Germans are clueless about the build-up of their pension, a new study by Fidelity International has shown. The investment company said that despite all the initiatives to improve people’s pensions knowledge, most employees neither know how high their pension will be nor are they familiar with the three pillar pension system
Industry responds to EIOPA consultation
Pension and investment associations across Europe have expressed different views on what they see as the future of cross-border pension provision, as the European Investment and Occupational Pension Association (EIOPA) closed its consultation on the IORP Directive yesterday
European mandates June 2009
Pension Insurance Corporation has appointed Schroders to manage an initial £100million segregated Global Corporate Bond Portfolio
