NETHERLANDS - The industry-wide pension fund for the metalworking and mechanical engineering PMT has made a modest return of 1.4% during the second quarter.

This gives the fund a return of 3.8% during the first six months, taking the scheme's assets to almost €33bn while its coverage ratio rose by 13% to 153%.

PMT's investments in equity - totalling 35% of assets - yielded 6.7%, thanks mainly to investments in emerging markets, Europe and the US, while 12% in alternative investments yielded 1.8%.

In contrast, fast rising long-term interest rates forced its 40% in fixed income to present a negative return of -1.9%, the scheme said in its official figures, while the 13% holding in property also created negative returns of -1.7%.

With 33,000 companies and over 1m participants as customers, the metal scheme is the Netherlands' largest commercial sector pension fund.

At the same time, the €12.1bn railways pension fund SPF has reported second quarter returns of 3.6%, and a rise of its funding ratio to 198%.

After currency hedging, its 50% asset holding in equity yielded 8.7% but with 33% of assets in fixed income, bonds again delivered a negative returned -2.6%.
SPF's returns on a 10% real estate asset allocation was 1.6% while 5% alternatives delivered a 3% return.

SPF's average total return during the past 10 years amounts to 6.9%.

Elsewhere, the €215bn civil service scheme ABP has indicated its intention to decrease its investments in oil.

ABP's head of commodities Tom Steenkamp said the fund wants to be less dependent on oil and commodities because of large price fluctuations.

"As part of our investment plan for next year, we are also looking into our commodities portfolio, which makes up 3% of our assets at present," spokesman Michel Meijs said, while declining to comment specifically on its allocation to oil.

"Because the size of ABP's investments, it will have an impact on the market," he explained.