POLAND - Assets in the mandatory second pillar increased by over 23% in value over the last half year, climbing to over PLN130bn (€34.7bn).
Regular contributions from the ZUS, the Polish governmental social insurance institution, made up around PLN7bn of the PLN25bn increase over the last six months - 2.1% more than in the same period last year.
Remainder of the growth is down to "an economic boom on the capital market," Polish analyst company Analizy suggested in its latest report on pension fund assets.
At the end of May, the accumulated market value of all 15 Polish second pillar pension funds stood at PLN130bn, having increased 23.5% from December.
However, analysts noted because of a late transfer from ZUS the assets have increased to PLN135bn by the end of June.
PZU's pension fund is said to be among the pension funds which have grown the most, having increased its assets by 19.3% to over PLN17.9bn and therefore maintaining its position as the third-largest player in the second pillar market.
The PZU Group, Poland's former monopoly insurance company, meanwhile, remains at the heart of a dispute between Eureko and the Polish government.
At the company's shareholder meeting last week, the treasury ministry, which holds a 55% stake in the company, used its position as the major shareholder to block a Eureko proposal to distribute half of PZU's 2006 profit of PLN3.7bn as a dividend.
Eureko commented to IPE the move had been expected.
Eureko holds 33% minus one share of PZU and, under a 2001 appendix to the 1999 privatisation agreement, was given the right to buy another 21%.
Eureko's attempts to implement the agreement have been blocked by successive Polish governments for what observers say are "purely nationalistic reasons" and the issue is now the subject of international arbitration.
The treasury ministry rejected the proposal to distribute dividend on the grounds that all profits should be left in the company to cover its investment projects, including the management board's proposed purchase of a bank and the move towards creating a large financial and banking institution.
There has been considerable talk of merging Poland's largest retail bank PKO BP, PZU and the postal bank into a mega financial institution.
Earlier this year, a new chairman was appointed at PKO BP, the largest state-owned bank.
Local press comment has claimed, in reality, such plans could be financed with the profits remaining after a dividend payout and that the treasury blocked the dividend to stop money going to Eureko.