Total assets within the Hungarian voluntary pension fund system increased to HUF1trn (€3.2bn) by the end of 2014, an increase of 10.5% over the previous year’s figure of HUF913bn, according to Stabilitas, the Hungarian pension fund association.
The figures cover savings held by Stabilitas members and account for more than 90% of the voluntary pension fund market in Hungary.
Members’ contributions last year amounted to HUF61.2bn, up 20% from 2013, with more than HUF24bn paid in in the fourth quarter alone, double the amount paid in during the last quarter of 2013.
Employers, meanwhile, paid in HUF36.4bn over 2014.
Member numbers stayed roughly the same at 1.1m, but there was an 8% increase in new entrants.
László Lehoczky, president at Stabilitas, stressed that the voluntary funds provided attractive yields at low cost for members.
“The asset growth of over 10% in the current low-interest-rate environment is a particularly good performance,” he said.
“And the 20% growth in individual contributions, with the amount paid in in the last quarter, shows that members are extremely satisfied with the performance of their pots.”
Meanwhile, preliminary figures from the Organisation for Economic Co-operation and Development (OECD) show that, at end-2014, total pension fund assets in Hungary made up 4.1% of the country’s GDP, a 0.1-percentage-point rise over the year.
The real net investment rate of return for calendar year 2014 was 9.6%, placing the country behind the Netherlands, Denmark and Sweden but ahead of Finland, Canada, the US and Japan, as well as most countries in Central and Easter Europe.
The same study showed that, on average, Hungarian pension funds allocate less than 10% of their portfolios to equities, maintaining more than 75% in bills and bonds.
This high level of allocation to fixed income is also followed by Hungary’s near-neighbours the Czech Republic, Slovakia and Romania.