BELGIUM – A Belgian pension fund pioneering a system set up under a national law dating from 2006 to cover first and second-pillar pensions for civil servants working for groups of regional authorities achieved a gross return of more than 9% in 2012.
The OGEO fund, based in Liège, reported an increase in assets under management (AUM) of more than €212m, a significant improvement on the €74.5m increase reported for the year previous.
The fund attributed its performance to a policy of low administrative costs, which are held at no more than 0.5% of total investments.
The fund, founded in 2007, aims to take over state and regional responsibility for the pensions for both officials and associated ‘contractual agents’, who normally carry out the same functions, but with fewer employment privileges.
The OGEO ‘multi employers’ fund was set up to take advantage of Belgian law, passed in October 2006, to cover occupational pensions.
The scheme’s development brings together the management functions of a number of smaller pension funds in a bid to improve efficiency.
The fund conforms with specifications set by the EU’s 2003 Occupational Retirement Provision (IORPs) Directive, now being considered for revision.
Currently, OGEO manages funds for the pensions of 4,000 personal, from eight sponsor entities.
These include the administration of the Liège province, the fire service and the water utility.
Marc Beyens, the fund’s director, told IPE the fund currently manages €934m of assets, making it the fifth-largest scheme in the country.
OGEO is currently 40% invested in government bonds, 20% corporate bonds, 20% equities, 10% office buildings, 7.5% insurance products and 2.5% “other”.
Investments in real estate are to double, according to Beyens.
Investments are almost entirely restricted to the euro-zone. Any investments outside the euro-zone are protected through currency risk measures.
Beyens said OGEO’s expansion plans could eventually include the pension plans of public authorities in the rest of the country, including the Flanders region and Brussels.