Which BSE stocks did the Pilon II funds trade in the first three months of the year?

Pilon II private pension funds increased their investments in the main companies listed on the Bucharest Stock Exchange (BVB) in the first quarter of this year, according to our calculations based on the reports of the managers of the seven funds.

These are investments in shares of electricity, oil and gas producers, as well as in bank securities, companies that dominate our capital market and occupy the largest shares among the risk assets managed by the Pillar II funds, for which the contributions have increased this year from 3.75% of the monthly gross income of employees to 4.75%. However, the funds received their first increased transfers in the second part of March, so the increase in holdings in the main BSE shares can only be attributed to a small extent to the increase in contributions.

• The value of the investment of mandatory private pension funds in Hidroelectrica shares reached 6.4 billion lei, in March

The investment of all seven Pilon II pension funds in Hidroelectrica, the largest Romanian company on our stock exchange, amounted to 6.39 billion lei in March, compared to 5.71 billion lei at the end of last year, an increase resulting from both appreciation of the share price as well as from the purchases made by the funds managed by NN Pensii, BCR Pensii and Metropolitan. Thus, the Pilon II funds came to have 10.2% of the producer and supplier of electricity, of which the holding of the fund managed by NN Pensii amounted to 1.94 billion lei, equivalent to 3.2% of the company, and that of the fund AZT Viitorul Tău was 1.64 billion lei, respectively 2.7% of Hidroelectrica.

The energy company is 80% owned by the Romanian State so that, according to the legislation in force, pension funds can invest up to 10% of their assets in Hidro shares, compared to only 5% in the case of companies in which the state has a stake of below 50% of the capital. Under these conditions, the investments of three of the seven compulsory private pension funds (Aripi, AZT Viitorul Tău and Metropolitan Life) had exceeded 5% of the managed assets.

• Metropolitan Life and the fund managed by BCR Pensii sold Banca Transilvania shares

Banca Transilvania is the second most important company from the BVB from the portfolios of the Pilon II funds, whose investments in the shares of the credit institution from Cluj were 5.88 billion lei, with almost 15% more than the value from the end of last year, in the first row due to the increase in the bank's quotation, which marks new historical highs. Metropolitan Life and the fund managed by BCR Pensii sold Banca Transilvania shares between January and March of this year, in the first case the reason being, very likely, reaching the holding threshold of 5% of the fund's assets.

On the other hand, the Aripi and AZT Viitorul Tău funds bought securities of Banca Transilvania, so that in the first three months of the year, the Pilon II pension funds made net purchases of shares of the credit institution. At the end of March, the seven private pension funds owned 26.4% of the bank's capital.

• Aripi, BCR Pensii and NN Pensii bought OMV Petrom shares

The value of Pilon II investments in shares of the oil and gas producer OMV Petrom was almost 5.76 million lei in March, up 17.4% compared to last December, especially against the background of the increase in share prices, which set new historical records. The Aripi, BCR Pensii and NN Pensii funds bought the company's securities in the first three months of the year, but Metropolitan Life sold, probably also in the context of its holding approaching the 5% threshold of assets. Even so, in March, the fund's holdings of SNP shares were above this level.

At the end of the first quarter, the investments of the seven mandatory private pension funds in OMV Petrom shares equaled 13.7% of the company's capital.

• No Pilon II fund sold Romgaz shares in the first three months of the year

The pension funds Aripi, AZT Viitorul Tău, the one managed by BCR Pensii and Metropolitan Life bought Romgaz shares in the first three months of the year, and the other three Pilon II funds kept their investments in the gas producer unchanged. Thus, the value of the holdings of mandatory private pension funds reached almost 3.7 billion lei, in March, the equivalent of 17% of Romgaz's capital, and since the company is controlled by the state, the funds still have room for acquisitions.

In the case of BRD, the value of Pilon II's holdings reached 2.7 billion lei in March, 22.7% more than at the end of last year, both due to the increase in the share price and the acquisitions of Aripi, AZT Viitorul Tău and Metropolitan Life. Thus, the mandatory private pension funds had come to control almost 18% of the credit institution with a French majority shareholder.

• Metropolitan Life became the shareholder of Aquila, while Vital became the shareholder of One United Properties

Metropolitan Life and BCR Pensii were the most active Pillar II pension funds in the first quarter of the year. The Metropolitan administrator increased the fund's exposure to seven BSE companies, namely MedLife, One United Properties, Transelectrica, Transport Trade Services (plus BRD, Hidro and Romgaz already mentioned). The fund also took a stake in Aquila, acquiring 41.67 million shares of the consumer goods distribution and logistics company. Metropolitan Life's only sales were to companies where holdings had exceeded the 5% threshold of assets. At the end of March, the fund had assets of 19.08 billion lei, about 26% being investments in shares listed on the BVB (Metropolitan Life only has investments in local shares).

The fund managed by BCR, which had assets of almost 9.7 billion lei, bought shares of Aquila, Electrica, One United Properties, TeraPlast (plus Hidro, OMV Petrom, Romgaz already mentioned) and sold shares of Alro and Fondul Proprietatea (plus Banca Transylvania mentioned above).

The fund managed by NN, which had the largest assets in March of 45.84 billion lei, did not sell any share holdings from BVB and increased exposure to Aquila and Electrica (in addition to the already mentioned acquisitions - Hidroelectrica and OMV Petrom ). AZT Viitorul Tău, with assets of 28.3 billion lei, sold shares to Evergent Investments (in addition to the acquisitions of BRD, Banca Transilvania and Romgaz), while Aripi, with assets of 12.4 billion lei, did not sell anything from its portfolio of shares from BVB (purchases - Banca Transilvania, BRD, OMV Petrom and Romgaz). The Vital Fund, managed by Carpathia Pensii, became a shareholder of One United Properties.

The pension fund managed by BRD kept its share holdings at BVB unchanged in the first three months of this year. The fund is about to be acquired by Banca Transilvania, according to Economica.net.

At the end of March, the net assets of the seven Pilon II pension funds had reached 134.9 billion lei, an increase of 6.5% compared to the assets of December last year, about a quarter being investments in shares, while government securities represented 65%. The number of participants in the private compulsory pension system had reached almost 8.2 million people.

According to a press release from the Association for Privately Administered Pensions in Romania (APAPR), after sixteen years since the establishment of the system in our country, the value of the average account of a participant is around 17,000 lei, but the value of the account for participants who have a full contribution period it is about three times higher, reaching approximately 10,000 euros per participant. Of the sums accumulated in the Romanians' accounts, about 72% represent the transferred contributions, the remaining 28% being the gain made by the administrators' investments, net of all the commissions charged. Over the entire sixteen-year period of activity, Pillar II funds recorded an average return of 7.8% per annum, among the highest in Europe and the OECD during this period.