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Capital saved on 2nd level pension plans up 6% in first half year of 2018

Photo: pixabay.com.
In the first half-year of 2018, deposits on state funding pension plans grew by 6% or EUR 198.1 million in Latvia, reaching EUR 3.48 million at the end of June, as reported by Finance and Capital Market Commission.

Negative tendencies dominated stock markets during the accounting period. This was largely because of concerns over tariff wars. In six months’ time, MXWD Index lost 1.5% of its value. STOXX Europe 600 Index declined 2.4%. In the first six months, profitability of active plans ranged from -4.2% to 1.3%. For balanced plans it ranged from -2.4% to 0.4%, whereas profitability of conservative plans ranged from -2% to -0.4%.

At the end of June, the largest ratio in deposit plan portfolio was held by investment fund certificates (46.3%) and debt securities (44.6%). 53% of deposit fund certificates focus on deposits in stocks or stock funds, and 39% on fixed income tools.

The volume of deposits in Latvia when compared to the end of 2017 has grown by 1.9% and was EUR 724 million or 20.8% of total deposits (including EUR 394.4 million in state or guaranteed bonds, EUR 75 million in commercial debt securities, EUR 4 million in stocks, EUR 32.4 million in deposit funds, EUR 11.6 million in Latvia’s venture capital market, and EUR 206.2 million in credit institutions) at the end of June.

Of all foreign deposits, 92% came from European economic zone member states, including a great deal from Luxembourg, Ireland and Lithuania.

At the end of June, a total of 1,278,472 had joined state funding pension plans, including 65.2% compulsory members.


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