Asset under management for pension funds in Austria grew by 5.9% quarter-on-quarter in Q2 2020 to €23.2bn, according to a report by the Financial Market Authority (FMA).
Assets increased by 6% for multi-employer pension providers, or überbetriebliche Pensionskassen, to a total of €21.1bn in the second quarter of the year. Company pensions saw a 5.6% growth quarter-on-quarter to total assets of €2bn.
Assets managed by company pension schemes amounted to 6.1% of GDP at the end of 2019.
According to the report, return on investments of all pension funds stood at 6%, showing signs of recovery in Q2, even if in the first six months of the year returns recorded a negative 4.6%. The performance over the last 10 years was on average 3.6% per year.
Company pensions recorded returns on investments for 4.9%, compared to a negative 1.9% in the first six months of this year. The performance of multi-employer pension providers was 6.2% in Q2, with underlying returns in the first six months of -4.9%.
Performance achieved its lowest point in March with -10% at the peak of the COVID-19 pandemic, but rebounded in the second quarter.
Despite low interest rates, bonds continue to make up the largest share in an Austrian pension fund’s portfolio with 41.43%, followed by equities at 33.78%, financial institution credits with 7.90%, real estate with 5.21%, loans and credits with 0.80%, and other assets at 10.87%.
Pension funds invest 29.75% of their assets in foreign currencies after currency hedging transactions. Assets held indirectly through investment funds amount to 97.21%.
Additionally, report showed that the number of people entitled to pension benefits has decreased by 0.1% in Q2 compared to the previous quarter.
In total 984,67 people are currently part of the Austrian pension fund system, and 114,000 (11.5%) are already receiving a pension from company pension funds.
Five multi-employer pension providers and three single company pension schemes manage the total amount of assets for the country.