Sweden’s second-largest commercial pension fund AMF announced it generated a 34% return on its equity portfolio in 2021, and increased its solvency level, in a year of more restructuring and diversification of the investment portfolio.
Announcing full-year results this morning, the pension fund – the default provider of the SAF-LO contractual scheme for blue-collar workers – reported a total return of 16.5%, with its head of asset management thanking sharply-rising stock markets and a continued economic recovery for the results.
The pension fund reported that its solvency level increased to 232% by the end of 2021, from 196% a year before.
Johan Sidenmark, AMF’s chief executive officer, said: “During the year we have been able to successfully continue our determined work to restructure and diversify our portfolio to benefit as much as possible from the traditional pension management’s particularly good opportunities to invest long term.”
He added that the firm’s full-year return corresponded to SEK90bn (€8.7bn), which would be passed on to its customers, in spite of a year with increasing economic uncertainty, geopolitical tensions and growing inflationary unrest.
Thomas Flodén, head of asset management at AMF, said: “Our equity portfolio accounted for the strongest development during the year with a return of 34.3%, but our properties and our alternative portfolios also delivered very good figures, 12.1% and 10.2% [respectively].”
AMF reported that its average annual return over the past five years now stood at 9.2%, and 8.8% over the past 10 years, up from last year’s figure of 7.4% for both of these stretches, and that its 16.5% full-year return compared to 7.1% this time last year.
Total assets under management grew to SEK850bn, from SEK715bn at the end of 2020.