NETHERLANDS - Dutch investment funds returned 8.2% on equity investments in the first quarter, outperforming the MSCI World index by 0.1 percentage points, according to supervisor De Nederlandsche Bank (DNB).

Over the same period, the funds generated a return on government bonds - mainly from euro-zone countries - of 2.1%, the DNB said.

The bond return fell short of the iBoxx Euro Sovereign all maturities index, which rose by 2.9% following declining capital market interest in France and Italy.

However, investment funds produced a 2.4% return on corporate bonds, according to the DNB.

The regulator attributed the modest, 0.2% return of Dutch hedge funds - compared with a rise of the Dow Jones Credit Suisse Hedge Fund index of 4% - to the 3.2% depreciation of the euro against the US dollar.

Equity funds, bonds funds and mixed funds reported a net outflow of €2.3bn, €1.3bn and €0.2bn, respectively.

The combined assets of Dutch investment funds increased by 6.2% to a record €507bn, the DNB said.

It concluded that the net contribution of €3.6bn was mainly due to institutional investors.

The regulator added that the number of investment funds fell slightly from 1,478 to 1,472 during the first quarter.

Separately, the DNB announced that 103 of the approximately 450 Dutch pension funds are facing a rights cut of 2.2% on average next year if they hope to improve their coverage ratios to the required minimum of 105%.

Of these schemes, 34 probably need to apply a discount of more than 7%, the watchdog said, following its evaluation of the recovery plans of approximately 300 pension funds.

The regulator said 23 of the 34 schemes had opted for a maximum discount of 7% on 1 April 2013, indicating that additional cuts could be applied later.

It concluded that there were no significant deviations between the measures indicated by the pension funds in February and the submitted evaluations.

Pension funds facing a rights cut have combined assets of €390bn and more than 7.5m participants in total.

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