ASF: The assets of private pension funds were 131.5 billion lei last year, up 31%

The private pensions market in our country reached, at the end of 2023, total assets worth 131.5 billion lei, an increase of 31.4% compared to the end of the previous year, according to the report of the Financial Supervisory Authority (ASF) regarding the evolution of the private pension system in Romania last year.

As a share of GDP, the total assets of the private pension system registered a level of approximately 8.5% at the end of December 2023, marking a positive evolution over the last years. In the last quarter of 2023, but also for the whole year, the volatility of net unit assets of private pension funds was moderate, with no short-term shocks.

The total value of the assets of privately managed pension funds (Pillar II) was 126.74 billion lei, on December 31, 2023, up by approximately 31.4% compared to the same date in 2022. This represents a historical maximum, being the best year recorded by the privately administered pension system. The number of participants registered in the Pillar II system was 8.15 million people at the end of 2023, compared to 7.96 million people at the end of the previous year. The average contribution of participants, with contributions transferred in December 2023, was approximately 276 lei/participant, while on December 31, 2022 its value was 237 lei/participant.

During 2023, the contributions transferred to the privately managed pension system were in the amount of 12.82 billion lei, an increase of approximately 17% compared to the previous year.

The weighted average rate of return of all privately managed pension funds was 7.39% in December 2023, up from the end of 2022 when it was 4.13%. At the end of 2023, the average asset value of a participant in the privately administered pension system was 15,700 lei, registering an increase of over 28% compared to the same period of the previous year.

During 2023, net personal asset payments were made to participants in the amount of 919 million lei for 54,518 participants and beneficiaries. Investments of privately managed pension funds in government securities represented 66.42%, up from the level of 62.3% recorded on December 31, 2022. At the same time, investments in shares represented a percentage of 23.32% of the total value of the assets of the pension funds from Pillar II.

Regarding Pillar III, the total value of the assets of optional pension funds was 4.75 billion lei at the end of December 2023, up by approximately 31% compared to the same period of the previous year. The number of participants registered in the optional pension system, on December 31, 2023, was 710,777 people, up 13% compared to the same period of 2022, according to the ASF report.