FINLAND - Kalevi Hemilä, the current managing director at Finnish pension insurance company Etera, is one of 20 people competing for the top position at Keva, the local government pension institution.

Hemilä (pictured), who was previously a government minister but is currently at the helm of the €4.8bn provider, is the only individual among the 20 candidates who is named as working at another pension fund provider, although it is possible there are more as five people declined to be publicly-named.

Timo Viherkenttä, deputy CEO of Keva, and Jari Sokka, executive director for statics and actuarial affairs at Keva, have both also applied for the position.

The other hopefuls come from various public, local authority, finance and banking organisations in Finland where they hold senior positions. The successful candidate will be chosen on December 4.

Markku Kauppinen, resigned from his position as chief executive at Keva, the €22bn fund, in July following allegations of corruption around his political role and investments made by the pension fund. Supervisory officials later found in its own investigation there was no sign of any wrongdoing.

Kauppinen had strongly refuted any allegations of funding irregularities, but felt that his position was untenable and wished to reinstate trust and confidence in pensions and Keva in particular, as the saga threatened to damage the fund. (See earlier IPE story: Keva chief resigned ahead of exoneration)

The Finnish media alleged there were questions around a political donation to the Central Party from Nova Group, a motor sled manufacturer, and a subsequent decision by Keva to invest in a real estate project at that firm.

However, a report published today by the country's supervisor cleared officials at Keva and Nova of any wrongdoing, and said activities between Keva, Nova and Kauppinen were legal, met all property investment criteria, and had been managed in exactly the same way as any other real estate transaction would be considered.

Despite the storm at the top, the fund returned 6.5% in the first half of 2009 following a continued rally from equity markets. It invests 36.9 % in equities, 48.7% in fixed income, 9.5 % in real estate, 3.5 % in private equity, 1% in hedge funds and 0.4% in commodities. The fund also invests approximately 20% of its assets in Finland.

Hemilä's Etera also posted a positive first-half performance with an overall return of 2.6%, although it noted the value of its premium income fell by 9% to €239m compared to the same period in 2008, while its solvency position reached 13.9% of technical provisions, or 2.4 times the required solvency level.

The value of the fund reached €4.85bn at the end of June, as the firm still managed to increase its share of sales of new employee and self-employed policies to 17% and 9% respectively, even when premium income declined on the back of weakness in the employment situation in the construction industry - its biggest market.

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