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Ilmarinen, the €23bn Finnish mutual pension insurance company, plans to raise its equity exposure by 2 percentage points each year until 2012, according to Jussi Laitinen, chief investment officer.
A host of funds have taken the same path since Finland’s law on pension investments was liberalised six months ago.
Maximum permitted equity exposure has risen from 25 to 35 per cent, with equities being defined extremely broadly, encompassing both hedge funds and private equity.
Funds had welcomed the changes, according to Matti Leppälä, international director for the Finnish Pensions Alliance.
Teacher and psychologists’ fund enters into admin merger with AP-PJD
MP Pension, the pension fund for teachers and psychologists, is planning to join the architects’ pension fund (AP) and the agronomists and veterinarians’ pension fund (PJD) in a joint administration structure. The aim is for the funds to have combined administration and management, but to continue as three separate pension funds with their own members. The boards of the three funds have decided to look into such a structure.
By joining forces, the funds are hoping to keep costs down as well as ensure higher returns. They are also hoping to offer better advice and services to their members. Together, they will have assets of €8.5bn under management and almost 75,000 members. AP and PJD have had joint administration since 2000. The merger will take place in 2008.
MP has 57.1 per cent of its portfolio allocated to bonds, 23.9 per cent in equities, 14.6 per cent in property and 4.4 per cent in cash. It is significantly larger that both AP and PDJ with assets of around €6.8bn. AP and PDJ together have assets of €1.6bn and a 54.5 per cent allocation to bonds, 32.5 per cent to equity and 8.5 per cent to property.
