CZECH REPUBLIC - ING Penzijní fond achieved a net profit of CZK 509.6m (€21.2m) in 2007, a drop of almost 18% compared to the previous year.
The pension fund claimed the fall in profit of 17.7% followed "unfavourable developments" on the capital markets, and in particular a decline in the price of bonds, as this asset class accounts for more than 80% of the fund's overall portfolio.
In addition, latest figures from the pension fund revealed an estimated yield of 2.5% to scheme members for 2007 - down from 3.6% in 2006 - although ING claimed despite the "slight decrease" the pension fund remains "one of the best growing pension funds on the market over the long-term".
It argued the ING fund recorded the second highest growth in value or members over the past three years, at 3.43%, just behind Generali PF, which recorded an average rate of return of 3.88% between 2005-2007.
The yield of 2.5% reported by ING is slightly higher than the 2.4% achieved by PFCP, the Czech Republic's largest pension fund, although it is significantly lower than the 4.5% agreed by Aegon and which is being financed by shareholder money. (See earlier IPE story: AEGON sets top Czech return rate)
Jiří Rusnok, chairman of the ING Penzijní fond, said: "This situation has hit virtually the whole pension fund market. However, despite the lower growth in value for 2007, ING PF remains one of the best growing pension funds on the market."
Rusnok claimed over the past three years ING recorded the second highest growth in value on the market, and since 1995 - when the pension fund system was first established - ING PF has recorded the third highest growth in value of 6.25%, slightly behind Generali PF and CSOB PF Progres, which both achieved a yield of 6.32%.
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