SWEDEN - The decision to increase its investment portfolio equity allocation by 14 percentage points in 2009 helped the AI Pension, Architects and Engineers achieve an 11.1% return.

Figures from AI Pension, which was renamed in October 2009, reported a capital return of SEK450m (€46m) over the year and a net profit of SEK605m, compared with a loss of SEK955m in 2008. This brings the value of the fund’s total assets to SEK4.55bn. (See earlier IPE article: Swedish architects’ fund returns 7.8%)

AI Pension attributed its positive performance to the “higher allocation to equities combined with a positive trend on the stock markets”. It said the solvency ratio of the fund at the end of 2009 stood at 141%, giving it a green light on the Financial Supervisory Authorities (FSA) traffic light test, and enabling it to set a 3.5% bonus interest rate for AI Life policyholders. 

At the end of December 2009, the asset allocation of the fund comprised 36% in equities - an increase from 22% the previous year - and 13% in absolute return funds. However, the largest investment was a 46% holding in interest-bearing assets such as bonds, interest rate derivatives and cash. The remaining 5% of the fund was allocated to property, only slightly below the 6% target allocation in 2008.

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