DENMARK  - Denmark's largest pension scheme Arbejdsmarkedets Tillægspension made a DKK 5bn (€670m) profit on hedging activities in the first half of this year.

The ATP Group said its half-year report showed that the bonus potential - reserves - increased by DKK 4.5bn the period after provisions of just under DKK4bn for the increase in life expectancy.

It said its hedging activities "generated a profit of DKK5bn following changes in the interest-rate spread between swaps in euros and Danish kroner".

"This helped strengthen ATP's reserves, totalling DKK56.6bn at June 30," the scheme said in a report.

"It is satisfactory to note that the reserves of the ATP Group have been significantly strengthened during the first half - despite a turbulent period with rising interest rates," said chief executive Lars Rohde.

The market return on investment of the ATP investment portfolio was DKK6.1bn, or 1.7%.

ATP said: "The return has been achieved thanks, in particular, to a high return on private equities and real estate and to the performance of listed domestic equities, which contributed DKK2.2bn to the return.

"The total market return on listed equities was DKK 3.0bn, equivalent to 3.6%."

But ATP noted "a continued increase in life expectancy" during the period, which triggered a further DKK 3.9bn in provisions at the annual update of the mortality base.