Investment returns at Sweden’s AMF slipped to 2.6% in the first nine months of this year from 8% in the same period last year, as low interest rates and market nerves hit third-quarter returns.
Reporting interim figures for January to September, AMF said its solvency level fell to 204% from 207%.
Peder Hasslev, head of investment, said: “Low interest rates and nervous stock markets put a damper on the return in the third quarter.”
Premium income at the the occupational pensions provider, jointly owned by the Swedish Trade Union Confederation (LO) and the Confederation of Swedish Enterprise, rose to SEK15.2bn (€1.6bn) in the nine-month period from SEK13.53bn.
Overall group profit was slightly higher year on year at SEK13.53bn from SEK13.42bn.
However, the company pointed out that last year’s stated profit had been reduced by SEK20bn as a result of changes to the discount rate used to calculate liabilities.
This year’s interim profit, on the other hand, has only been hit by discount rate changes to the tune of SEK900m, it said.
“In the course of the year,” Hasslev added, “we have increased our investments in real estate to produce higher future returns for a reasonable level of risk.”
He mentioned AMF’s recent investment in UK wind farms, with the company committing in October to an offshore wind fund managed by the Green Investment Bank.
“An investment in which sustainability goes hand in hand with good, long-term returns,” Hasslev said.
Total assets under management grew to SEK517.9bn by the end of September from SEK487.8bn at the same time last year.