Pension funds in NPFs increase by 2.9% to 4.33 trillion rubles in Q2
In 2020 Q2, non-governmental pension funds (NPFs) not only reversed the decline registered in Q1 but also were able to increase the amount of pension funds by 2.9% to 4.33 trillion rubles. This was driven by the recovering securities market and growing economic activity, as shown in the latest issue of the ‘NPF Market Trends’ commentary.
Pension savings were up by 2.5% to 2.89 trillion rubles, and pension reserves — by 3.6% to 1.43 trillion rubles. Supported by the positive dynamics of the securities market, the value of investments in corporate bonds and shares in pension saving portfolios rose by 7% to 1.57 trillion rubles and by 4.7% to 159.0 billion rubles respectively.
In Q2, NPFs redistributed pension reserves in favour of less risky assets: over the course of the quarter, investments in corporate bonds increased by 6.4% (to 686.0 billion rubles) while those in government securities rose by 4.7% (to 164.3 billion rubles). This was caused, among other things, by the fact that NPFs began to prepare for new pension reserve investment requirements that are to come into force from 1 January 2021.
During the pandemic, NPFs continued to pay pensions without interruption. Most of them provided their services to clients remotely. NPFs have not yet made use of the regulatory relaxation that allows them to estimate assets at their value as of 1 March. However, a number of NPFs do not rule out this possibility depending on the market situation.