NETHERLANDS - Dutch pension funds have lost a total of €94bn since their combined assets peaked at the end of the first quarter of 2008 at €763bn, the pensions regulator De Nederlandsche Bank has revealed.
Pension schemes lost €26bn in assets during the first three months of 2009, leaving their combined assets at €670bn by the end of March, the watchdog's latest statistics show.
Equity investments took the largest hit during the first quarter and decreased in value by almost €17bn to €274bn. Derivatives and loans also fell by €7bn to €40bn and by €5bn to €48bn respectively.
The combined value of deposits and other liquidities also dropped by €13bn to €21bn, added DNB.
In contrast, the value of fixed income investments rose by €15bn, making the sector worth €257bn to pension funds, whereas the allocation to property remained relatively stable at worth €14bn.
DNB figures also revealed that approximately three-quarters of pension funds' assets have been invested abroad.
That said, the value of cross-border equity investments has dropped by €103bn to €192bn since 2007, and listed equities have almost halved in value to fall by €98bn to €104bn. In the same period, fixed income investments have decreased by only €2bn to €233bn, DNB indicated.
Looking further back in time, pension funds' combined overall returns on investment were 2.7% in 2007, and equity and fixed income yielded 3.4% and 0.8% respectively. During that same period, the indirect property sector was the worst performer with a return of -10.2%,
According to DNB, investments in direct real estate yielded 0% in 2007, whereas the combined returns of the alternative asset classes were 6.7%.
The regulator's statistics also showed that 82% of pension funds had contracted-out their administration in 2007, and 88% had at least 30% of their assets managed by an external party.
At the end of 2007, a total of 5.9 million workers were participating in a Dutch pension plan. Deferred participants and pensioners totalled 8.9 million and 2.6 million members respectively. And at least 67,600 pensioners were over the age of 90.
Other evidence revealed pension funds last year granted their active and non-active participants an indexation of 2.57% and 2.37% on average, said DNB.
During the first quarter, the number of pension funds on offer in the Dutch pensions market had reduced by 20 schemes to 636.
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