SWITZERLAND - Swiss institutional investors' exposure to equities has declined to a new low, according to figures from the Swiss National Bank.

Direct investment in the asset class by pension funds and insurance corporations has now dropped to CHF116.5bn (€73.5bn) - or 14% of the total assets of CHF819.9bn. That's according to newly released figures for 2004 contained in the Swiss National Accounts.

The allocation is down from CHF125.8bn in 2003 (16% of the total) and CHF216.6bn in 2000 (28.2%).

The figures also reveal that the holdings of debt securities have risen from CHF237.8bn (31% of the total) in 2000 to CHF305bn (37%) at the end of 2004.

"One of the relationships revealed by the detailed figures in the financial accounts is the way in which stock exchange prices and investment policies in recent years have impacted upon the investments of insurance corporations and pension funds," the central bank said.

"Since the end of 2000, investments in debt securities have risen continuously, attaining a level of CHF305bn at the end of 2004.

"In 2001 and 2002, the value of shares had fallen substantially due to declining prices. In the following two years, holdings of shares were reduced.

"As a result, direct investments in shares dropped back to CHF 116 billion by the end of 2004, despite rising prices on the stock exchanges.

By contrast, holdings of mutual fund shares have risen to CHF151bn.