ICELAND - An increase in the value of domestic securities and Housing Financing Fund (HFF) bonds led Icelandic pension fund assets to rise by  ISK18.8bn (€105.2m) in November 2009.

Latest figures from the Central Bank of Iceland showed pension funds totalled ISK1.763trn (€9.9bn) net at 30 November 2009 . This is an increase of around 1.1% from the October total of ISK1.744trn, and an improvement of almost ISK150bn from the ISK1.615trn recorded at the end of December 2008.

The bank claimed the increase in November "is mostly attributed to domestic securities that increased by ISK21.5bn and HFF bonds increased by ISK10.3bn. The year-on-year increase amounted to ISK140bn". This is equivalent to an 8.5% rise in assets between November 2008 and 2009.

A breakdown of the figures showed that at the end of November credit and equities accounted for ISK1.65trn of the total assets, with the remainder in cash and deposits.

Fixed income assets, such as government bonds, and other credit investments such as HFF bonds, accounted for just over ISK1trn of the assets. This is a rise in value of 2.3% in November and 14.5% over the 12-month period.

The largest holding was in HFF bonds - issued by the Housing Financing Fund to finance cash loans for the purchase or construction of housing -which increased by 39.7% to ISK363.2bn in the year to 30 November 2009.

The statistics also revealed that around ISK1.13trn of the total net assets was invested in domestic securities, with just ISK520bn in foreign securities.

However, the bank said there is "still some uncertainty regarding final value of the pensions' funds assets", which are estimated based on a sample of the largest pension funds. The next set of statistics is expected to be released early next month.

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