IRELAND – The average Irish pension managed fund fell 4.9% in the first quarter of this year according to research by Mercer Investment Consulting.

Volatile equity markets, aggravated further by the onset of the war in Iraq, are attributed to the negative returns of Irish pension funds in the first quarter, although on a longer-term basis, the picture is more positive says Mercer. The average return over the ten-year period is +8.7% per annum, which “comfortably exceeds inflation and should provide some reassurance to investors at this time,” says the quarterly report.

The best performing Irish managed pension fund of the first quarter was Irish Life Global Access, which produced returns of –3.4%. Eagle Star balanced fund came second with returns of –4.2%.

Aberdeen and KBC Asset Management were the worst performers of the quarter with returns of –6.4% and –5.6% respectively.

Over a five-year period to the end of March, New Ireland topped the survey at returns of +1.1% per annum, followed by Montgomery Oppenheim at 0.6% per annum. AIBIM and Standard Life Investments were the underperformers with returns of –3.9% per annum and –3.7% per annum respectively. This compared to the average return for the five-year period per annum being –2.2%.

In terms of asset distribution, the average allocation to equities of Irish managed pension funds at 31 March 2003 was 65.5%, broken down as 35.6% in global ex-Euroland equities, 13.7% in Euro ex-Ireland equities, and 16.2% in Irish equities.

The average allocation to fixed interest securities was 23.5%, with 20.1% in Euro-zone government bonds, 1% in non-euro government bonds and 2.4% in non-government bonds.

An average of 6% of total assets was invested in property, and 5.1% in cash.