Swiss funds hit historic returns low
SWITZERLAND - Swiss Pensionskassen posted a negative return of 13% for the full year 2008, according to preliminary calculations for the Credit Suisse Pensionskassenindex.
Looking at 100 Pensionskassen, the Swiss bank calculated a negative return of 8% for the fourth quarter, making the full-year result the worst in this decade.
"While the index managed to just stay positive from February to August after a weak January, September rang in the considerable decline of the index for the whole of 2008," Credit Suisse pointed out.
Full details of the calculations will only be available in two weeks but last year's performance is well below the worst so far which was 2002 with a negative return of almost 8%.
Credit Suisse calculated Q3 generated a -1.6% return with September (-3.25%) wiping out the slightly positive performance of 0.8% in July and August. (See earlier IPE story: Swiss funds fall 1.6% in Q3)
The Federal Swiss Insurance Office last week estimated around half of all Swiss schemes are currently underfunded as on average they need a 4% annual return just to "keep their cover ratios constant". (See earlier IPE-story: Half of Swiss schemes underfunded)
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