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Austria’s VPK and BVP consider merger

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AUSTRIA- The two billion-euro multi-employer Vereinigte Pensionskassen AG, VPK, and the 1.2 billion-euro banking and insurance sector pension fund BVP-Pensionskassen AG may agree to merge by the end of August.

Martin Cech, investment manager of the VPK and Karl Timmel, BVP’s head of pension, told IPE that the funds are still consulting but a decision should be reached next month. They said they thought the deal would go ahead.

The two pension funds made the possibility of a merger public through a joint press release saying that due to “historical changes” in the banking sector - and the similarities between the two funds - that a merger would “make sense”.

If the merger happened, the new pension fund would gain “a very good position in the field of pension funds” the statement said.

The new pensionskasse would be probably named VBV, after the redundancy fund the two pension funds jointly created in 2002, VBV Mitarbeitervorsorgekasse AG, Timmel said.

The fund currently has 70 million euros in contributions and has a market share of about 35%, Cech said. In the statement, the two pension funds describe VBV as “a leader in the Austrian market”.

The release also said the synergy between the two funds, would be useful to boost capital and would leave room for a “wider diversification” and risk hedging.

Cech explained that “wider diversification” would probably involve mainstream asset classes and alternative investments, such as hedge funds and real estate, which are already used by VPK.

The VPK has currently two per cent invested in hedge funds, three per cent in real estate, between 25 and 30% in equities, three per cent of which are Austrian equities, and the balance in cash and bonds.

The fusion would not bring any changes in the pension arrangements of the members of both the pension funds, the two funds said.


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  • QN-2546

    Asset class: Real Estate Equity Fund (non listed).
    Asset region: Europe.
    Size: Total CHF 600m, approx. CHF 100-300m per fund investment.
    Closing date: 2019-06-28.

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