Bayer Pensionskasse, the pension fund of the German pharmaceutical and agriculture company, has made new investments amounting to €950m (nominal value) in fixed income, according to its annual financial statement for 2023.

The scheme pushed for investments in interest-bearing registered securities to keep the weight of the asset class stable in the long term, at approximately the target level set in its most recent asset/liability management (ALM) study, it added.

It bought securities with a book value totalling €900m, with a return above the pension fund’s discount rate, the statement noted.

The Bayer scheme invested with a focus on long-term securities with high credit quality, looking at an “overall maturity profile as balanced as possible” in the long term, taking existing issuer termination rights into account. The ALM study conducted recently led to moderate adjustments to its strategic asset allocation.

The scheme reviewed its investment strategy last year, with an eye to interest rate scenarios forecasting lower returns. Interest rates are still relatively low, when looking back over a long period of time, despite market returns rising in the meantime, it added.

Bayer Pensionskasse invests 43.5% of total assets – which are worth €9.73bn – in promissory notes and registered securities, up from 34.5% in 2022. It also invests 41.5% in investment funds, down from 43.5% the prior year, 2.9% in private equity, 9.2% in real estate, 0.5% in real estate loans and other credit products, and 2.3% in other investments, down from 9.4% in 2022, according to the statement.

The pension fund lists under ‘other investments’ the DWS BP-Cash fund with around €112m, created specifically to pool cash positions, and its private equity SICAV company-targeted funds totalling approximately €160m last year, as it continues to pursue its strategy.

The bond Spezialfonds is worth around €502m. The portfolio includes local authorities and government bonds, with an approximate exposure of €266m to long-term, high-quality corporate bonds, it added. The bond Spezialfonds recorded a write-up of €46.6m at the end of last year.

Income from invested assets amounted to around €623.2m last year, up from €215.7m in 2022, including write-ups amounting to €406.5m, it said.

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Luigi is IPE's Berlin-based DACH correspondent. His coverage includes regulation and the latest pensions and investments trends, and, being a native Italian, he also covers Italy’s pensions market. He has reported from Italy and Germany on international politics and business for European and US publications including USA Today, Bloomberg BNA and for the investigative magazine L’Espresso. He was previously Germany correspondent for Mergermarket covering M&A.View full Profile

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