Lithuania’s voluntary second-pillar pension funds managed to weather market volatility, although end-of-June returns were below those recorded three months earlier.

According to the Bank of Lithuania (BoL), the sector’s regulator, year-to-date nominal returns averaged 4.7% compared with 7.55% three months earlier.

The five high-risk funds, which can invest up to 100% in equities, once again generated the highest return, of 9.8%.

The nine medium-risk funds (with equity limits of 50-70%) returned 5.37%, followed by the four low-risk funds, investing 25-30% in equity, at 2.67%, while the eight bond funds generated 0.49%.

Audrius Šilgalis, senior specialist at the Financial Services and Markets Analysis Division of BoL’s Supervision Service, wrote: “After an impressive start in the first quarter of this year, the second quarter was not as successful for pension funds.

“Turmoil in European and global financial markets led to a decline in the unit value of most second-pillar pension funds in the second quarter.

“However, due to a very successful beginning of the year, the return of only one conservative investment pension fund in the first half of this year has been negative.” 

Membership since the start of the year grew by 2.5% to 1.19m, and assets by 9.4% to €2.04bn.

Investment returns contributed €77.9m to this year’s asset increase.

A further €15m came from additional contributions from members choosing to top up their 2% contribution with a further 1% of their wages, and €17.9m from the match-funded state contribution for these members.

In the smaller third pillar, returns averaged 6.06%, with the five high-risk funds generating 8.79%.

Returns from the medium-risk funds averaged 4.88%, with two of the four generating negative returns, while the three low-risk funds averaged 1.25%.

Membership of the sector grew by 11.2% since the start of the year to 44,395 and assets by 12.6% to €54m.

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