FINLAND – Varma, Finland’s largest private sector pension insurer, made an eight percent return on investments in 2004 - but said it would continue to “rationalise” its operations.

“Return on investment stood at 8.0%, the market value of investments at more than €21.2bn,” Varma said. It returned 8.1% in 2003.

Varma said it increased its share of the earnings-related pension insurance market by around one percentage point to 38%, meaning a rise in the number of people insured of 13,700. Pensions paid totalled €2.6bn, a four percent increase on 2003.

“2004 was financially and operationally favourable for Varma,” said president and chief executive Matti Vuoria. “Pension services and insurance services performed well. We met the majority of our financial goals and will continue the search for improvements in efficiency.”

Varma said its preparations related to Finland’s pension reform were implemented “on schedule and according to plan”.

The firm said that the number of pension applications will increase significantly as the baby boom generation retires in the near future.

“The Finnish pension reform and the planned combination of the statutory earnings-related pension acts require major changes in information systems and ways of working.

“Varma will continue to rationalise its operations and customer service provision.”

Varma paid pensions to 286 000 people at the end of 2004, a total of €2.6bn.

Investment income was divided as follows: loans (4.8%), bonds (5.0%), money-market instruments and deposits (2.6%), equities (17.9%), and real estate (5.1%). It said the allocation of assets did not change significantly during the year.