OREANDA-NEWS. 2014 was the most difficult and challenging year in the entire history of Russian non-state pension funds. The range of negative factors included: falling prices across the financial markets, as a result of which many pension funds showed accounting losses; uncertainty about the savings component of pension assets, including a freeze on contributions; and changes to regulatory and supervisory procedures, which altered the legal status of non-state pension funds and created of a system of guarantees. Furthermore, the period 2013-2014 saw an acceleration in the process of consolidation among pension market players, along with shifts in ownership and the formation of pension fund groups.

Even under these challenging conditions NPF’s generated an average return of 4.81% per annum last year. Individuals who made no choice of NPF and whose pension savings therefore formed part of VEB’s expanded portfolio saw a return of 2.6%. Individuals who chose to place their pension savings with a private management company’s investment fund saw a return of 1.04%. Last year’s performance was shaped above all by the re-evaluation of securities at year’s end. Interestingly, NPFs’ cumulative returns since 2009 have been considerably stronger and on average slightly exceeded inflation (58.67% versus 58.65%). They are also well above the cumulative return on VEB’s expanded portfolio (44.25%).

The report presents figures for the return on invested pension savings at 56 NPF’s covering some 86.3% of all individuals served by non-state pension funds and responsible for managing more than 84.6% of all pension savings held by NPF’s. Information on returns since 2009 was available for 49 these, which were thus included in the ranking by net returns.

21 NPF’s showed cumulative returns in excess of inflation (58.65% over the six-year period). VEB’s expanded portfolio returned just 44.25%: the state corporation was outperformed by 37 non-state pension funds.