Pension funds change investment structure due to market situation
In 2021 Q1, non-governmental pension funds (NPFs) increased investment in Russian government bonds to 32.4% of pension savings and 16.5% of pension reserves. This happened amid a decline in the bond market and a surge in OFZ yields, which made it possible for funds to buy them at a lower cost.
Investment in corporate bonds contracted driven by negative revaluation and a decline in market volumes. Investment in riskier assets, such as shares, also went down. In this context, NPFs also reduced the proportion of their investment in real and financial sector companies.
In addition to the market situation, new rules for placing pension reserves (effective from 1 January 2021) also influenced their investment structure. The new regulation limited investment in higher-risk assets and brought rules for investing pension reserves closer to those for pension savings.
Further details of the situation in the pension market in the first quarter are available in Review of Key Indicators of Non-governmental Pension Funds.