DENMARK – Danish labour-market pensions company PenSam Liv said its more active investment strategy was bearing fruit, despite an overall loss for the first half of this year.
PenSam Liv – part of the wider PenSam group – reported pre-tax profit of DKK1.1m (€147,000) for the first half, corresponding with a return on capital of 0.1%.
Though sharply down in absolute terms from the DKK118m reported for the same period last year, the company described the slim profit as satisfactory given current market conditions.
Helen Kobæk, managing director, said: “It is satisfactory and underlines the fact the more active and focused investment strategy we have been following since 2010 is bearing fruit.”
However, overall PenSam Liv made an investment loss of 0.3% in the period, it said.
In absolute terms, the investment loss of DKK356m compares with the DKK4.2bn profit reported for the 2012 first half.
“All plans include with-profits products, and the return was significantly affected by the rise in yields we saw in the second quarter,” Kobæk said.
Pension contributions rose to DKK2.5bn between January and June, up 1.8% from the same period last year.
Total assets rose to DKK81.7bn by the end of June from 77.6bn at the end of December.
In other news, pensions manager Unipension produced returns of between 2.6% and 2.9% for the three professional sector pension funds it runs, with foreign equities the highest performing asset class.
The Architects’ Pension Fund (AP) had a 2.7% return for the period, while returns for MP Pension and the Pension Fund for Agricultural Academics and Veterinary Surgeons (PJD) were 2.6% and 2.9%, respectively.
For all three pension funds, foreign shares generated the highest returns of between 9.1% and 9.3%.
Government and other bonds ended with narrow losses for the funds.
Unipension said the financial markets had been marked in the first half by rising equities markets.
“The price rises were due to, among other things, positive development in the US with residential property market growth and stronger consumer demand,” it said.
Meanwhile, commercial pensions provider AP Pension posted a 1.9% investment loss in H1 for its traditional pension products, but a profit for unit-link products of between 3.1% and 7.3%.
Søren Dal Thomsen, managing director of AP Pension, said: “The result was marked by losses on bonds and interest-rate hedging as a result of the increase in interest rates in the six-month period.”
However, the profit for unit-link customers was the result of positive developments on equity markets, he said.
Separately, Lærernes Pension said the teachers’ industrial dispute in Denmark hit its contribution levels over the first half.
Pension contributions for January to June were DKK1.9bn compared with DKK2.1bn in the same period the year before, and DKK230m lower than had been expected in the company’s budget.
In April, when the industrial action took place, only a third of the normal monthly contributions from the scheme’s 130,000 members were received, it said.
Teachers in Danish schools were locked out of their place of work without pay in April in a four-week industrial dispute over working hours.
Pre-tax investment returns at Lærernes Pension fell to 0.5% in the period from the 5.2% produced for the same period last year.
Total group assets rose to DKK60.8bn at the end of June from 57.9bn at the end of December.
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