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SEB: average 2nd level pension member’s savings come close to EUR 3,000

Photo: pixabay.com.
Last year, capital of SEB Bank’s managed 2nd pension level members grew 17% – to EUR 790.5 million. The average amount of savings per participant is EUR 2,740, which is 410 euros or 18% more when compared with the end of 2016, BNN was informed by the bank.

As for 3rd level pension programme participants, SEB Bank earned for them EUR 2.4 million in 2017, increasing their capital to EUR 150 million.

According to the bank’s representatives, every fourth or 23% of 2nd level pension participants in Latvia are SEB Bank’s clients: approximately 228,000 Latvian residents have entrusted their pension capital to SEB Bank. Last year, their capital grew by EUR 117.6 million, of which EUR 14.3 million was revenue from deposits secured by the manager’s realized investment strategy.

SEB Investment Management chief Jānis Rozenfelds comments: «Most employed people have no idea of the capital they have saved up on their 2nd level pension. It is highly important to follow the pension manager’s financial results and pick the most attractive pension deposit strategy. We believe it is very simple to follow dynamics using internet banking services. However, and agreement that would allow banks to offer such a service has yet to be reached.»

He says it is possible to use internet banking services to follow 2nd level pension savings and expand society’s understanding of the pension system in Latvia. «This would definitely help raise trust for the pension system and make it easier to understand the link between pension savings and paying taxes. It would also contribute to the reduction of grey economy, which would reduce the risk of poverty for residents when they retire,» Rozenfelds continues.

To plan ahead for their retirement, 87,000 of Latvian residents made additional deposits to their 3rd level pensions in SEB Bank. The volume of assets by the end of the year had exceeded EUR 150 million, which is EUR 25 million more when compared with 2016.

The bank also notes that the number of collective contracts had doubled last year. This means that more and more employers become involved in creating pension savings for their employees. In total, payments of private persons to 3rd level pension plans in 2017 were equal to 79% of all payments. 21% of them came from employers.

«We have reached a certain volume of capital managed for 2nd level pensions. We have decided to reduce commission fee for managed pension plans. Since the beginning of the year, the commission fee for active and balanced plan is 0.68% annually. The total maximum commission fee, which includes fixed and volatile fee, has been reduced from 2% to 1.30% a year,» said Rozenfelds.


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