Nordrheinische Ärzteversorgung (NAEV), the German pension fund for doctors in the state of North Rhine-Westphalia, has upped its allocations to alternative asset classes.
The pension fund has increased allocations in private equity, private debt and infrastructure by 6.2% to 23.9% of its total assets under management, according to its 2022 financial statement.
In 2021 allocations to alternatives went up by 3%, although the share of infrastructure in its portfolio decreased by 0.2%.
Last year, the share of infrastructure investments in its portfolio went up to 6.9%, from 5.6% in 2021, private equity investments increased to 9.3%, from 6.8% in 2021, and allocations to private debt grew to 7.7% from 5.3% in 2021, according to the statement.
Investments in real estate went up by 1.7% last year to 23.4% of total assets.
The pension fund built up its investments in alternatives because of “strong returns” achieved through the asset classes in previous years, it added.
NAEV said last year that it was continuing on the path to switch from bond investments carrying low yields to illiquid asset classes.
The private debt investments of the pension scheme benefited from the rise in interest rates in 2022 to meet expectations, it said, adding that the asset class helps to further diversify its portfolio.
Assets under management have increased year-on-year in 2022 by 5.8% to €15.7bn, from €14.8bn in the prior year.
NAEV recorded positive returns of €829m last year, up €271m compared with €558m achieved in 2021, despite a challenging year, it said in the statement.
Net return last year stood at 5.17%, up from 3.56% recorded in 2021, a level reminiscent of times before the financial crisis, the scheme noted.
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