IRELAND - The e10.8bn National Pensions Reserve Fund (NPRF) posted a negative return of 1.1% for the third quarter ended September 30 and a return of 3.3% for the first nine months of the year amid difficult market conditions.
The negative result came on the back of concern over high oil prices and the US economy.
The fund, set up to provide partial funding of Ireland’s pension costs from 2025, had posted a return of 1.8% for the second quarter and a 4.5% return for the first six months of the year.
The return brought the NPRF’s total value to e10.8bn, up from e10.6, representing a return on investments of e334m for the first nine months of the year.
Commenting on the returns, Commission Chair Donal Geaney, said difficult market conditions during the summer and early autumn had caused a “pause” in the rapid growth the fund had enjoyed since March 2003.
“Concerns about issues such as high oil prices and the strength of the US economic recovery have caused markets to stall,” he said.
“While business fundamentals remain strong, it is likely that further progress in the short-term will depend on a resolution of the headline issues which are the subject of investor concern.”
The fund said equity markets experienced a “substantial correction” in July and August.
“The combination of FED tightening, rising oil prices and sluggish jobs growth proved significant downward pressures,” the NPRF noted.
“Markets consolidated in September, notwithstanding the high oil prices, as they adopted a wait and see attitude with respect to the US economy. Bonds experienced a positive quarter as inflationary fears subsided.”
Asset allocation stands at 73.6% equities, 13% bonds and 13.4% cash.
Mark Evans has been appointed as a director at Independent Trustee Services (ITS) to lead trustee appointments in London.
The Pension Protection Fund (PPF) is consulting on changes to the actuarial assumptions it uses in valuations in a bid to better reflect the bulk annuity market, with schemes set to move into surplus on aggregate.
Private sector defined benefit (DB) schemes were 96.3% funded on a Pension Protection Fund (PPF) compensation basis at the end of July, according to the lifeboat fund's monthly index.
Conduent has completed the sale of its actuarial and human resource consulting business to private equity investor, H.I.G. Capital.