NETHERLANDS – PGB, the €13.8bn pension fund for the Dutch printing industry, returned 13% in 2012 on the back of a "defensive" investment policy.

The scheme's 29% allocation to equities performed best, returning 17.2%, a far cry from the 6.4% loss the asset class registered the year previous.

The 49% allocation to fixed income returned 9.3%, with government bonds and credit returning 10.2% and 8.9%, respectively.

Inflation-linked bonds were the best-performing investment within the alternatives portfolio, with a return of 24.6%.

Property, commodities and infrastructure/sustainable investments returned 3.6%, -1.2% and 4.6%, respectively.

The pension fund said it decided to stick with its defensive investment strategy in 2012, following the divestment of hedge funds, high-yield credit and emerging market bonds the year previous.

PGB said its hedging policy contributed 1.6 percentage points to its 2012 results, adding that it has hedged 55% of the interest risk on its liabilities.

It has also fully covered its currency risk, but said it increased the "tactical bandwidth" from 2.5% to 10%, to account for the possibility of a deepening euro crisis.

The pension fund saw its coverage ratio increase to 102.3% at year-end, enabling it to avoid a rights cut this year. However, it noted that a discount was still a possibility for next year.