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Impact Investing

IPE special report May 2018


Siemens Swiss scheme makes 9.6% return

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SWITZERLAND – Buoyed by last year’s positive equity markets, Siemens’ Swiss pension fund says it finished its 2005 business year with a 9.6% return on its CHF1.7bn (€1.1bn) assets and with slight overfunding.

Siemens Pensionskasse said its coverage ratio – or the extent to which pension liabilities are met – totalled 101.3% for the business year. The figure is among the best for private schemes in Switzerland.

“The improvement (in the coverage ratio) has to do with restructuring measures on the one hand and above average returns on equity markets on the other,” Siemens Pensionskasse said in its annual report.

Siemens Pensionskasse has 37.5% of its CHF1.7bn invested in fixed income, 30% of which was Swiss debt. Another 37.5% is allocated to equity and 5% to alternative asset classes. The remaining 20% is invested in real estate.

Despite the good results for 2005, Franz Haudenschild, managing director of Siemens Pensionskasse, said there was no ground for “euphoria”.

“Equity markets are now very overvalued. Moreover, our chief priority is to rebuild our thin reserves in a sustainable way,” Haudenschild was quoted as saying in the fund’s annual report.

Haudenschild also said that as of October 1, 2005, the transition to a defined contribution arrangement had been completed. “The new plan provides several advantages, including realistic benefits and greater transparency.”

As examples, Haudenschild said employees could now better track their retirement savings and would get the option of having their entitlement paid out as a lump sum, an annuity or both.

Founded in 1965, Siemens Pensionskasse has around 6,000 contributing members and 2,650 pensioners in Switzerland. Roland Rümmeli is responsible for portfolio management at the fund.

Siemens, the Germany-based technology giant, is currently consolidating all of its Swiss pension plans within Siemens Pensionskasse.

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