The average return achieved by Dutch pensions funds in 1997 was 15.8%, according to WM Company figures. The returns were powered by the equity performance, which earned funds returns of 32.1%.

Domestic equity produced a spark-ling 41.2%, while international re-turns averaged 26.0%. Fixed interest overall had returns of 8.0%, while real estate delivered a handsome 14.6% to pension fund investors.

The variation in fund performance was very much dependent on their eq-uity investment, points out Cees Westland of WM Co in Amsterdam. The proportion of equities was now 37% of fund portfolios, a dramatic rise from the 24% five years ago.

Around 15% of equity portfolios was in domestic equities in 1997 and 21% in non-domestic.

All pension funds increased their exposure to equities in 1997," says Westland. Even the smaller funds are catching up in this regard with the larger one. The use of asset liability management studies has helped push funds in this direction, he adds.

"Funds actually withdrew money from the Dutch equity market last year, simply because of super returns," says Westland. "But there was no clear shift between their Netherlands exposure and their European exposure in 1997." This current year will see portfolios restructure for the euro, he predicts. Overall, no new money was allocated by pension funds in the last five years to domestic equities.

As is to be expected, the larger funds had a bigger exposure to international equities, but how well they did last year depended very much on where they were invested. Smaller funds have been overweight domestically, which has been beneficial over the past five years.

WM Company measures funds amounting to Dfl375bn ($186bn) in its universe. "We have an 85% coverage". This excludes the two giants ABP and PGGM, with combined funds of Dfl350bn, which the company also measures separately.

The two Dutch organisations VB for the company pension schemes and OPF for the industry-wide schemes also jointly issued their results for 1997. They include a list of performance for funds in both sectors. Fennell Betson"