Pensionskasse Post, the Swiss pension fund for the employees of the national postal service Swiss Post, with CHF16.33bn of total assets, has added real estate and infrastructure to its investment portfolio as the asset classes outperformed last year.
The scheme allocated CHF100m for impact investments in infrastructure, including more than half of that sum for clean, renewable energy infrastructure including wind farms, biomass, solar and hydroelectric power plants.
It currently invests 4% of its assets in infrastructure, or CHF654.84m, via the UBS Clean Energy Infrastructure Switzerland 1, 2 and 3 funds, the UBS Investment Foundation for Alternative Investments, the Fontavis SCS SICAVRAIF IA3, Renewables Infrastructure Fund Europe, and through the IST Investment Foundation, a non-profit organization by 12 pension schemes, according to its latest financial statement.
Pensionskasse Post also provides large amounts of debt capital in the form of direct and indirect loans, via municipalities, to hydroelectric power plants and other infrastructure companies, it added.
The pension fund also invests CHF2.70bn in real estate exclusively indirectly via real estate investment foundations. It allocates the assets in real estate in Switzerland through investment foundations Turidomus, Pensimo, Adimora, Assetimmo, and the UBS and Swiss Life investment foundation among others, and abroad through investment foundation Testina, according to the financial statement.
It has also conducted investments worth CHF400m in microfinance in developing countries to support projects in craft or agricultural sectors.
“There were adjustments and new investments in real estate and infrastructure, but on a small scale,” chief executive officer Françoise Bruderer Thom told IPE.
She added: “The strategy has remained [overallI] unchanged since 2022. For valuation reasons, the weight shifted in favour of alternative investments and real estate.”
The scheme invested 16.9% of total assets in real estate last year, up from 14.4% in 2021, 14.1% in alternatives, up from 12.9% in the previous year, 28.3% in Swiss bonds, 10.9% in bonds denominated in foreign currency, 7.2% in Swiss equities, and 18.1% in foreign equities, the statement added.
Swiss real estate returned 4.3% last year, despite rising interest rates, and foreign real estate closed the year with a performance of almost 9%. Infrastructure returned 11.3% in 2022, pushed by rising inflation and electricity prices, it said.
Within alternatives, commodities returned 17.2%, and hedge funds 16.4%, for total profits of CHF360m. The asses classes contributed to protection against inflation and negative impacts from market volatility. Swiss and foreign equities booked losses leading to a weight reduction in the fund’s portfolio.
“The performance last year was negative at -6.11%. The funding ratio was 102.4%. By the middle of this year, the funding ratio has increased by a good 1 percentage point. We’re more defensive,” the CEO added.
Assets are invested through 42 mandates, funds and investment foundations, including 37 managed by external manmagers and five in-house, according to the statement.
“We are currently [re]assessing investments and implementing our sustainability strategy,” Bruderer Thom said.
Pensionskasse Post is a member of the Ethos Engagement Pool which promotes dialogue with Swiss companies on ESG. Its largest stock positions include Nestlé (CHF175.3m), Novartis (CHF118.3m) and Zürich (CHF49.9m), according to the statement.
It is also a founding member of the Swiss Association for Responsible Investments (SVVK-ASIR), to check that its fixed income and equity portfolios are in line with ESG standards.
The latest digital edition of IPE’s magazine is now available
No comments yet