BELGIUM - The average weighted return for Belgian pension funds in 2005 was 15.1%, almost double the previous year's return.
The Belgian Association of Pension Funds (BVPI/ABIP) surveyed 36 funds with a total e6bn in assets and was based on a portfolio composed on average of 47% equity, 43% bonds and 6% real estate.
The 15.1% return was a massive jump from the 2004 return of 8.9%. It represented a continued upswing from poor results in the 2001/2002 equity bear market.
According to the association, average equity allocation was up 3% in 2005, from 44% to 47%, “essentially linked to the growth in stock prices on the markets”.
“Also, one observes that individual funds’ financial performances are closely related to the percentage invested in equity by each fund in 2005,” the BVPI/ABIP noted.
The strong returns were said to suggest a further improvement of funding levels of Belgian defined benefit pension funds - in 2004 the average ratio stood at 137.5%.
Since 1985, Belgian pension funds obtained an average yearly return of 7.9%, or 7.3% over a 10-year period.
The top stories this week were the High Court's decision to block the £12bn annuity transfer from Prudential to Rothesay Life, and a separate court ruling that 'raises the bar' for pension rectification exercises.
Guaranteed minimum pension (GMP) equalisation has soared to the top of pension schemes' to-do lists, with 58% stating it is a priority project, research from Equiniti has revealed.
Professional Pensions is holding its defined contribution (DC) conference on 4 September.