Publica, Switzerland’s largest public pension fund, has reported a 2.5% loss on its open portfolio for 2015.

In a statement, it cited the negative impact of a 14% exposure to emerging market debt and equities, with director Dieter Stohler also pointing out that emerging market currencies devalued by approximately 11% against the Swiss franc over the period.

He said the fund’s decision, however, to hedge developed-markets fully had boosted Publica’s overall return by 130 basis points.

Publica manages the open portfolio – by far the largest component of the scheme, with more than CHF32bn (€26bn) in assets – on behalf of 14 other pension funds, including its own.

It also manages a separate CHF4bn portfolio for seven closed pension funds with no active members.

In this portfolio, the share of domestic bonds stood at 36% – twice as high as in the larger portfolio.

A 2.9% return on domestic bonds helped the performance reach a positive 2.1% for 2015 for the retiree portfolio.

This return was further aided by a large exposure to domestic real estate, which, at 20%, was almost three times that of the open portfolio.

According to Publica, domestic real estate was the best-performing asset class in 2015 at 6.3%.

The pension fund noted that, despite last year’s loss, it has still outperformed its benchmarks, Pictet’s BVG indices, by 20bps between 2000 and 2015, with a 2.9% average return.

Meanwhile, Swiss companies saw their pension funding decline over the last year as discount rates fell and returns were only just positive, according to the quarterly Willis Towers Watson Swiss Pension Finance Watch.

Year on year, funding levels came down from 96.5% to 94.8% after an even lower drop at the end of September to 92.4%.

According to Willis Towers Watson, the fact the discount rate remained steady in the last quarter helped prevent a further decline in the funding level.

This development was aided by the fact that the overall average return in Swiss company pension funds stood at approximately 1% at year-end.

The consultancy’s calculations are based on the returns of Pictet’s BVG-40 pension index with a 40% equity exposure.

Other Pictet BVG indices with different underlying asset allocations estimated a much lower return for 2015 at less than 0.5%