Austria’s ÖPAG to take first steps cross border

AUSTRIA - ÖPAG, one of Austria's multi-employer pension funds, will offer pensions in other EU member states.

"We will offer pensions in two EU countries for existing customers which have employees in those member states," an ÖPAG spokesman told IPE.

He said he could not name the countries but confirmed that the contracts will be signed in the summer of this year. Austrian papers reported that one of the countries is among the new member states.

With this move,  ÖPAG makes use of the new freedoms granted under the EU pension fund directive, which is in effect since 2005. "As far as we know we are the first ones in Austria to take this step," the spokesman said.

In 2006 ÖPAG saw its returns dropped from almost 12% in 2005 to just over 5%. As with many pension funds, they were hit by badly performing equity markets in the first half of 2006. The fund pointed out that 2005 had been an exceptionally good year which will not always be repeated.

Because of the drop in returns, around 1% of the 8,500 people covered under ÖPAG's occupational DC plans will see their pension being cut slightly.

The pension fund has seen member numbers for occupational pensions rise from 7,830 in 2005. For 2007 ÖPAG head Johannes Ziegelbecker expects a further growth.

Fixed agreements have already been reached with a large electronics company, an Austrian food corporation, two foreign banks with offices in Austria and several building societies, the spokesman said. 

Overall membership numbers rose from 101,000 to 105,000.

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