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Allianz' Austrian pension funds dominate 3 and 5-year returns

Allianz’s €654.3m Austrian Pensionskasse was the best performing fund in almost every risk category in both three- and five-year periods to the end of 2016, according to Mercer.

The consultancy presented the results of long-term research into performance reported by Austrian Pensionskassen on Wednesday.

As each pension fund in Austria runs different portfolios for different clients – and different risk categories within those, according to a life cycle model – comparisons of overall returns are difficult.

According to the statistics compiled by Mercer, the Pensionskasse offered by Allianz performed best in the defensive, conservative, balanced, and active risk categories over both three- and five-year periods.

For the defensive category, for funds with equity exposure under 16%, Allianz returned 4.83% over three years, 100 basis points ahead of second-placed VBV.

In the balanced category (equities between 24% and 32%), Allianz funds took first and second place over three years with returns of 6.25% 5.3%. Valida was in third place with 4.73%.

In the dynamic category – for funds with 40% or more in equities – VBV claimed first place with a 5.8% gain.

The statistics do not reveal the worst performer in each category, but the spread between first and third place in several categories was significant.

Over a five-year-period Allianz remained the best performer in all categories with the exception of dynamic, which the €6.3bn VBV led.

The spread in performance over the five-year time period was most pronounced in the balanced and active (32% to 39% equity share) categories. While Allianz returned 6.93% and 7.40% annualised in each category respectively, the market average was 4.98% and 5.89%.

In an interview with IPE, Allianz Austria’s CIO Martin Bruckner said: “We were not too worried by the market downturn at the start of last year and were able to use it to buy some overweight in equities.”

At the presentation of the results Michaela Plank, principal at Mercer Austria, commented: “The long-term performance of Austrian Pensionskassen is good in light of the volatile markets.”

The major performance driver last year, when the overall market performance was 4.2%, was similar for most Pensionskassen. “We further increased emerging market bonds,” said Martin Sadelic, managing director at Valida, which manages €6.6bn in total both for the Valida Pensionskasse as well as the Valida Industriepensionskasse, the former Siemens corporate pension plan.

Results for “Vorsorgekassen” were also presented, covering the provident funds managing assets for the mandatory severance pay provision each employer has to build up for their staff.

The NÖ Vorsorgekasse was the best performer last year with 3.59%, while the market returned 2.25% on average. Over three years it gained 3.07%, beating the market’s 2.46%.

As contributions to Vorsorgekassen are mandatory since 2003 assets in this segment have grown to almost €9.5bn as per year-end 2016 with over €1.3bn in contributions for last year.

For the full chart of returns by Austrian retirement providers as well as further information on the country’s pension debate see IPE’s April issue. 

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