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Hannover scheme reports 21% rise

GERMANY - Hannoversche Kassen (HK), a multi-employer pension fund in the state of Lower Saxony, has reported a 21% increase in assets to €113m.

In a recent newsletter to clients, HK said the increase in assets during the 2005/2006 business year was mainly due to appreciation of its investments.

HK is a German Pensionskasse, or insurance-type scheme. As such, it guarantees a minimum annual return of 2.25% and in doing so takes an ultra-conservative approach to investing.

According to the newsletter, HK had 31% invested in bonds and bond funds at the end of the business year. Another 40% was held in real estate loans, while 22% was invested directly in real estate. Equity investments and cash each made up 2% of the total assets.

HK's net return for the business year was 4%, or on par with the average for German Pensionskassen. At the end of 2004, these schemes accounted for 20% of the €381bn in German corporate pension assets.

Regarding its return, the scheme said: "It should be noted that Hannoversche Kassen is investing in new real estate as well as that which is being modernised. In time, these investments should help enhance overall returns."

HK reported that it had almost 8,000 contributing members from whom it took in €18m during the 2005/2006 business year. It also had 433 pensioners.

Separately, PB Pensionsfonds, a multi-employer pension fund tied to German retail bank Postbank, said it had named Dieter Müller as a new board member.

Müller, 56, takes charge of investments and actuarial services. He joins the pension fund from the insurance arm of Postbank.

Launched in 2002, Pensionsfonds are Germany's answer to the Anglo-Saxon pension fund and hence invest according to prudent man rules.

Before last September, the biggest German Pensionsfonds was that of Robert Bosch, a maker of auto components and household appliances. The scheme had around €600m in assets.

In early September, German technology conglomerate Siemens confirmed to IPE that it had set up a Pensionsfonds for almost €14bn in pension assets.

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