The Italian association of first pillar pension funds for professionals, Adepp, and its German counterpart, Arbeitsgemeinschaft berufsständischer Versorgungseinrichtungen (ABV), have opposed any requirement for their members to invest under the European Union’s Savings and Investments Union (SIU).
Following a meeting in Rome this week, the associations’ presidents, Alberto Oliveti and Rudolf Henke, warned that “Brussels’ plan to channel private savings into the European economy – the Savings and Investments Union (SIU) – must not be automatically extended to pension funds for professionals.”
The presidents argued that pension funds for professionals differ from other institutional investors in the role they play in supporting the real economy.
They added that the management of assets “must remain anchored to the principles of prudence and diversification”, as the long-term solvency of the schemes and the payment of members’ benefits depend on investment decisions.
The members of the two associations manage combined assets of around €450bn.
Tangible commitment
The associations said their opposition to mandatory investment allocations under the SIU framework does not preclude a “tangible commitment” to supporting the European economy.
During the meeting, Oliveti and Henke agreed on the merits of domestic investment to support professionals, whom they described as “the economic engines of both Italy and Germany”.
Adepp has repeatedly said that its members (Casse di Previdenza) already contribute to supporting the Italian economy.
However, according to the latest figures from Italian pension regulator Covip, only 8.8% of the €136bn in assets managed by the country’s first pillar pension funds for professionals is invested in securities issued by Italian companies.
The largest domestic allocations remain government bonds and real estate, according to Covip.
To encourage greater investment in the domestic economy, the Italian government has launched several initiatives, including the Fondo Nazionale Strategico Indiretto (FNSI), a vehicle managed by partly state-owned investment bank Cassa Depositi e Prestiti to invest in Italian small and mid-cap companies.
The €30bn doctors’ pension scheme Enpam and the €12.5bn pension fund for chartered accountants, Cassa dei Dottori Commercialisti, have launched asset manager selection processes to invest in the state-backed fund.
Similarly, in Germany, the government and state-owned development bank KfW launched the WIN Initiative, backed by Bayerische Versorgungskammer (BVK), which manages €122bn on behalf of professional pension funds in Bavaria, to support start-ups.
Partnership renewed
Adepp and ABV also renewed their cooperation agreement for a further three years during this week’s meeting.
According to the associations, the memorandum of understanding provides for the systematic exchange of knowledge on sustainability, the adequacy of social security systems, pension reforms in Germany and Italy, and EU investment policy.
Henke said the strategic partnership would focus on developing common positions to help influence European policymaking.
“Adepp and Abv share the goal of preserving, defending, and supporting common interests – specifically, ensuring that the freedom to establish and manage independent schemes for the professionals is respected and further strengthened,” added Oliveti.
