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Swiss returns now predicted to average 10.1%

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SWITZERLAND - Calculations conducted by Swisscanto suggest the average return achieved by Swiss Pensionskassen in the first nine months of this year hit 8.2%, but rival firm State Street has predicted the figure is more likely to be 10.11%.

Depending on which sample is used, various investment and consulting houses have recently estimated the returns for Swiss pension funds generated over nine months to be between 8.2% and 10.11%. Lusenti and Credit Suisse sit between these predictions, having both reported a 9% average. (See earlier IPE stories: Swiss pensions return to full funding and Switzerland leaves minimum pension rate at 2%)  

Similar to Lusenti's findings, Swisscanto has calculated there has been a return to full funding levels so far this year for private Pensionskassen, as the average level is now said to be 103.5%.

Public pension funds are in many cases not required to fund their liabilities fully because of state guarantees or other special arrangements, and are now showing an average funding ratio of 91.3%.

In total, the average funding level has increased from 91.7% at the end of 2008 to 97.7% at the end of September.

Swisscanto noted that one-fourth of all private Pensionskassen in the 441 funds sample remain underfunded, but collectively they have combined assets under management of CHF360bn. (€238bn) .

Differences in the way calculations are made between these four firms derive from the method and sample used. State Street does not include direct real estate holdings and Swisscanto weights the returns by pension fund size. (See earlier IPE story: Row over Swiss funding levels)

If you have any comments you would like to add to this or any other story, contact Julie Henderson on + 44 (0)20 7261 4602 or email julie.henderson@ipe.com

 

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