IPE Top 1000: European pension assets drop to €8.95trn

The assets managed by European pension funds fell by 6.77% over the most recent 12 month period as measured by IPE’s latest annual research exercise, taking in the leading 1,000 pension institutions across the continent.

European institutions manage €8.95trn of retirement savings, IPE finds, having lost €646bn in aggregate over the year, largely due to the highly volatile markets and poor returns on equities and bonds.

In 2022, IPE recorded an increase of €512bn, or 5.6%, over the previous year to €9.6trn, reflecting the strong returns in most asset classes in 2021 as the global economy recovered from COVID-19.

The more benign environment of the first half of 2023 saw pension funds across Europe make up some of the value lost by their portfolios last year.

However, 2022 marked a sea change for European pensions, as higher inflation and interest rates reduced the value of pension liabilities but ushered in a new era of potentially more volatile and lower returns on most asset classes.

The headline figure decreased for the first time since 2013, when the European sovereign debt crisis was in full swing. The 2013 reading of €4.99trn was 2% lower than the previous year.

Source: IPE Research

In 2009, during the great financial crisis, overall assets in IPE’s study came in at €3.41trn, or 7.5% lower than the previous year.

This makes the 2023 reading the second-largest reduction in the assets held by European pension funds recorded by IPE over the past 15 years.

The ranking of Europe’s largest 10 retirement savings pools was nearly unchanged. The same 10 funds occupied the first 10 places in the ranking, topped by Norway’s Government Pension Fund Global (GPFG) with over €1.3trn of assets, or 14.5% of the total.

However, Denmark’s ATP, with €91bn of assets, dropped from fourth to seventh place in the ranking.

The largest 10 funds in Europe hold nearly a third of the total assets, consistent with the past few years.

IPE’s comprehensive annual research exercise was carried out in the second and third quarters on 2023 using most recent data available from occupational pension funds and pension insurers, funded first-pillar pension schemes, pension buffer funds and sovereign pension funds.

The full report and data set for the IPE Top 1000 2023 European Pensions Guide can be accessed online