The number of Polish second-pillar pension funds (OFEs) is set to shrink to 11 following yesterday’s announcement that Aegon Poland had signed an agreement to take over Nordea’s pension fund, pending approval from the Polish Financial Supervision Authority (KNF).

The Nordea OFE currently ranks seventh in terms of assets and eighth by membership.

As of the end of May, according to KNF data, it had net assets of PLN6.5bn (€1.5bn), a market share of 4.7% and a membership of 986,257 (6.0%).

While Aegon is currently in tenth place, with an asset share of 4.2% and a membership share of 5.6%, the takeover will push it into fourth place, behind Nationale-Nederlanden, Aviva and PZU.

Claus Stoltenborg, chairman of the board at Nordea PTE (pension fund management company), told IPE the sale would complete Nordea Group’s strategy, initiated two years earlier, of withdrawing from customer-focused business in Poland.

In 2013, Nordea divested its Polish banking, finance and life insurance businesses to PKO Bank Polski, the country’s largest bank

“In addition to this,” Stoltenborg said, “after the nationalisation of the 51.5% of the assets of the OFEs and the implementation of the zipper [slider] mechanism, where gradually assets are transferred to the state for the older part of the portfolio, it makes sense to consolidate and create larger units with critical mass to be able to service the customers well also in the years to come.”

Michał Biedzki, chairman of Aegon PTE’s supervisory board, said on Aegon’s website that the transaction would improve the quality of customer services and strengthen its market position.

“This latest transaction clearly supports Aegon’s ongoing strategy in key areas,” he said.

“In addition to divesting remaining non-core operations over recent years, it is Aegon’s ambition to further grow distribution and scale in core activities, including pension administration and asset management.”

According to Stoltenborg, the transaction, pending KNF approval, should be completed towards the end of the year.

This is the first sectoral consolidation since 2013, when PKO BP Bankowy took over Polsat’s pension fund, while the Warta fund was bought by Allianz.

It has nevertheless raised eyebrows given the uncertainties overhanging the second pillar, including the outcome of the current transfer window, which lasts until the end of July, and which, as of last week, had only seen some 55,760 applications.

Following this, the sector is set for its three-year statutory review that must be completed by the end of 2016.