Nordic roundup: PP Pension, Storebrand, Nordea, SEB, Länsförsäkringar, Keva
EUROPE – Viveka Ekberg is resigning from her role as chief executive at PP Pension, the media and journalist pension fund in Sweden, due to changes stemming from a new pensions agreement.
As part of the new agreement, tabled last week, PP Pension will close its defined contribution (DC) plan from 1 January 2014.
The media industry had been the exception to the rule in Sweden in having its own ITP 1 agreement – an occupational pensions deal for white-collar professionals – and not being managed by the national administrator Collectum.
But the labour market parties have now decided to end this exception and close the DC plan, which means premium payments to this part of PP Pension will cease.
The new agreement for the media industry comes into place despite the fact that all parties had expressed satisfaction with the previous arrangement, in place since 2009.
Ekberg said she was resigning because the operational conditions for the fund had changed due to the new agreement.
She said her position now required different skills from what she had to offer.
Ekberg will remain at the fund for a transitional period. She has a six-month notice period in her contract, but hopes to be able to leave before then.
How the existing assets in PP Pension’s DC plan will be treated, or whether PP Pension will be one of the preferred providers in the nationwide system, administered by Collectum, remains unclear.
PP Pension has some SEK10bn (€1.2bn) in assets, with the majority of the capital in its defined benefit plan.
Meanwhile, the third-quarter results season is in full swing and characterised by rising equity markets.
Storebrand, the Norwegian life and pensions company, saw its return in guaranteed portfolios reaching 2% for the quarter and 4.5% year to date.
Its balanced defined contribution pension product returned 5.1% for the quarter and 9.7% year to date.
Assets under management rose to NOK439bn (€59bn), an increase of NOK15bn.
SPP, the Swedish pension and insurance subsidiary of Storebrand, saw assets under management increase by SEK8bn to SEK132bn.
The firm’s DC product returned 6.4%, and whereas the defined benefit product performance was 4.7%.
The solvency ratio for Storebrand Life and SPP was 153%.
Rival Nordea, the banking and financial services firm, also saw its assets under management increase by 6% to SEK210.9bn, with the majority of inflows attributed to institutional investors.
The average performance of Nordea’s traditional pension products, or guaranteed products, was 2.3%.
SEB’s assets under management stayed stable at SEK1.2trn, whereas inflows to its life and pensions products increased by SEK14bn, with the unit now managing SEK436bn.
SEB Trygg Gamla Liv, a guaranteed product, returned 8% for the quarter and has a solvency ratio of 166%.
Profit at Länsförsäkringar Liv amounted to SEK2.7bn, due mainly to positive investment income.
The total return in traditional guaranteed products was 4.9%, while the solvency ratio remained unchanged from 1 January at 111%.
Kåpan Pensioner, the pension fund for government employees, returned 7.3% for the quarter with a solvency ratio of 128%.
In Finland, Keva, the local government pension institution, returned 10.2%.
The market value of the investments was €33.3bn at the end of September.
Among the asset classes, listed equities generated the best returns, at 14%.
Fixed income investments generated 8.8% and real estate investments (including real estate funds) 3.6%.
Among the smaller asset classes, private equity investments returned 8%, hedge funds 7.3% and commodity investments 4.9%.
Fixed income investments accounted for 47.1%, listed equities and equity funds for 37.8% and real estate investments for 7.7% of Keva’s entire investment portfolio at market values.
Private equity investments accounted for 4.8 %, hedge funds for 2.2% and commodities for 0.3%.
According to Ari Huotari, Keva’s director of investments, the year so far has turned out better than originally anticipated in terms of investments.
“The general generosity of the central banks – and, in particular, the European Central Bank’s promises of support for the euro – have resulted in higher returns on riskier investments,” he said.
“The coming winter, however, will not be all rosy. We are certain to see restless periods as well.”