Nordic roundup: PKA, ATP vs Tobin tax, F&P, AMF
EUROPE – Denmark’s PKA says it has billions of kroner ready to invest in the next good offshore wind farm project.
Peter Damgaard Jensen, managing director at PKA, said: “PKA is very keen to invest in more offshore wind parks.
“We have good experiences with Anholt and Butendiek, so we are have billions ready for the next good project.”
Investments in offshore wind farms would give members of PKA’s five labour-market pension funds a good, stable return for many years to come, and fitted in well with the organisation’s climate profile as well as creating growth and jobs, he said.
PKA has already invested DKK2.5bn (€335m) in the Anholt offshore wind farm, taking a 20% stake in the project.
The Anholt plant, which is set to produce 4% of Denmark’s total electricity consumption, became fully operational yesterday after the 111th and final turbine was connected to the grid and began transmitting power.
The pensions administrator has also invested DKK750m in the Butendiek offshore wind park off the island of Sild near the Danish-German border.
It has a 22.5% stake in the project.
PKA has said it aims to increase its infrastructure investment by DKK6bn to DKK16bn in the course of the next few years.
In other news, the new head of Danish pensions giant ATP has warned of “serious side effects” if the proposed EU financial transaction tax is brought in.
On its website, the DKK600bn pensions institution highlighted comments made by its chief executive Carsten Stendevad to a news wire.
Stendevad told Bloomberg the proposed tax on financial transactions would “instantly destroy our business model and force us to invest differently”.
ATP acknowledged that the planned tax on trading stocks and bonds was aimed at ensuring financial institutions made a fair and substantial contribution to the costs of the recent crisis.
He said even things with good intentions could have significant unintended consequences, and that the proposed levy was a good example of this.
“The bill will be paid by the Danish pensioners, not the banks,” he said.
If the tax passed into law, ATP would have to try to find suitable alternatives to German bunds, he said.
Triple A-rated euro-region bonds such as those from Finland and the Netherlands were not liquid enough for ATP, while US Treasury bonds carried a currency risk, Stendevad said.
Meanwhile, data from industry association Forsikring & Pension (F&P) showed investment returns at Danish pension firms surged 52% in 2012, while PAL tax payments rose 60% compared with the previous year.
In absolute terms, investment returns rose to DKK194.6bn last year from DKK127.8bn in 2011, the association said.
F&P’s deputy director Carsten Andersen said: “In 2012, there were strong increases in both share and bond prices.”
He added that it was rare for both asset classes to see growth at the same time.
Payments of the Danish tax on pension investment returns (PAL) increased at a higher rate than the returns themselves, reaching a total of DKK27.7bn in 2012, 60% higher than the year before, F&P said.
Separately, Sweden’s AMF says it is buying a 7,700 square-meter office building in Stockholm from DnB Liv Eiendom Sverige AB, worth SEK250m (€28.7m).
Mats Hederos, chief executive at AMF Real Estate, said the acquisition in the Stockholm district of Sundbyberg complemented the firm’s existing properties in the area and was in line with its strategy to invest around rail transport.
The property transaction was carried out through company acquisitions with an underlying property value of SEK250m, AMF said.
The building’s largest tenant is the charity Rädda Barnen (Save the Children Sweden).