Italy roundup: Inarcassa tilts towards inflation-linked government bonds

Inarcassa, the pension fund for self-employed engineers and architects, has rebalanced its portfolio towards a greater exposure to Italian government bonds linked to inflation, in line with its strategic asset allocation for the period 2022-2026, it said.

The board of directors for the pension fund has decided to at the same time slightly reduce allocations to riskier asset classes including European equities, emerging market bonds and high yield.

Inarcassa has increased its stake in Bank of Italy from 3% to 4.93% for a total investment of €370m, taking advantage of the budget law for 2022 which raises the ceiling of the shareholdings in the bank.

The lawyers’ fund Cassa Forense, the doctors’ scheme Enpam and the accountants’ fund Cassa dei commercialisti also increased their stakes in Bank of Italy to 4.93% after Intesa Sanpaolo and Unicredit banks divested their shares.

Cassa Forense said it had already bought a stake worth €225m in Bank of Italy, which returned 4.5%, or €70m, over the years. The pension fund allocates 11.7% to cash (monetario), 39.8% to bonds, 26.8% to equities, 10.2% to alternatives and 12.2% to real estate.

Priamo faces challenges

Fondo pensione Priamo, the second pillar fund for the public transport industry, has recorded positive results for its three sub-funds last year, despite complex investment activities in equity markets triggered by challenges associated with the pandemic.

The sub-fund ‘bilanciato sviluppo’ achieved a positive return of 5.82%, the ‘bilanciato prudenza’ 3.04% and the ‘garantito protezione’ 0.13%.

Total assets stood at €2bn, including €1.4bn in the bilanciato sviluppo, €124.12m in the bilanciato prudenza and €434.79m in the garantito protezione.

Priamo still expects challenges ahead with the raw materials crisis, the geopolitical risks of a conflict between Russia and Ukraine, the pandemic and the economic recovery still on-going.

The pension fund will therefore constantly monitor markets through a “control room” involving the entire governance of the fund, the board of directors, the management, the finance department, advisers and managers, it said.

Previmoda’s investment fund fares well on equities

The ‘rubino azionario’ sub-fund for Previmoda – the pension fund for the fashion and textile sector – has recorded a 10.80% return last year. The sub-fund invests mostly in equities (60%) and bonds (40%).

The sub-fund ‘smeraldo bilanciato’ also ended 2021 on a positive note returning 6.30%, while the ‘garantito’ closed the year with -0.36%.

Bonds, with the exception of those linked to inflation, were affected by the rise in interest rates, and this in turn had an impact on the garantito sub-fund which invests mainly in bonds (92.5%), the pension fund said.

Last year Previmoda awarded a mandate for the assets in its garantito sub-fund to Generali Insurance Asset Management.

Deutsche Bank skips engagement

The pension fund for the employees of Deutsche Bank in Italy has decided not to adopt an engagement policy.

The scheme justified its decision by stating that investments in equity-type instruments constitute approximately 5.4% of the fund’s assets, equalling to close to €29m at the end of December last year, and the share of participation in individual issuers is negligible.

This means that the chance of significantly influencing decisions at shareholder meetings of the investee companies
is extremely low, it added.

Moreover, starting to actively monitoring operations of investee companies and, where appropriate, exercising its voting right systematically or in relation to specific corporate events is a burden for the fund in terms of human and technical resources, not sustainable based on the current organisational structure.

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