GERMANY - The €21.8bn Pensionskasse for the German banking industry, BVV, returned 4.2% for 2010.

The largest German Pensionskasse will grant its 707 member banks a 4.7% interest for last year.

The 4.2% net capital return contributed €917.7m to the BVV’s profit of €32m, the Pensionskasse noted in a statement.

Another major contributor to the positive result was the €100m BVV Pensionsfonds launched in 2008.

For 2011, board member Rainer Jakubowski expects capital markets to remain difficult, but is convinced the “consistent diversification of the assets”, as well as the “security-oriented allocation strategy”, will continue to help the fund.

With the Bavarian regional bank BayernLB joining in 2010, the number of individual members has now increased to 339,047.

Board member Helmut Aden warned that the application of Solvency II to IORPs would “place a heavy burden” on the German second pillar.

In other news, the German association for retirement provision, aba, has conceded that it might have assessed the level of participation in the second pillar “a bit too positively” in the past, outgoing chairman Boy-Jürgen Andresen noted in his speech at the aba annual meeting in Berlin.

Its last poll among companies, carried out by the Infrastest institute in 2007, had shown that 64% of all employees paying social contributions would be entitled to an occupational pension.

For 2008, the federal statistics bureau had only found a 51% participation rate among companies with 10 or more employees.

Andresen pointed out that there were various explanations for this, including the fact the Infratest poll included all sizes of companies.

“We have to research the dynamic of growth in the occupational pension sector in more detail,” Andresen said.

The statistics bureau itself conceded that its compulsory survey among companies was still fairly new and could possibly be improved.

Nevertheless, compared with the statistics bureau’s previous survey, which found a 40% participation rate in 1990, the system still saw growth of 10 percentage points over 18 years.

Andresen also said that some industries showed a 90% participation rate, while in others there were hardly any occupational pension schemes. He said it was necessary to research the reasons for this.