In the first quarter of the year, Pension Plans increased their assets by 2.8 billion euros to 121.326 billion euros, 2.36% more than at the end of 2020, thanks to the notable revaluation experienced by their portfolios following the good performance of the financial markets, as benefits were higher than contributions.
Thus, the Pension Plans show positive returns in all terms, especially in the 1-year accumulated return, where the average return net of expenses and commissions reaches 15.15% of total systems. The Variable Income Plans stand out, which in the last year have fully recovered the adjustment of March of last year and present a return of 43% in one year. Long-term profitability continues to be very satisfactory: at 25 years, the average annual profitability reaches almost 3.5% for all the Plans, and in the medium term (10 and 15 years), they present a profitability of 3.6% and 2.5% respectively.
In the first quarter of the year, net benefits of 246 million euros were recorded, as a result of the reduction compared to the same quarter of the previous year, in the volume of gross contributions in all the systems. The decrease in inflows for the Individual System Plans stood at 19% to 585 million (720 in the same quarter of 2020), a similar percentage recorded for the Employment Plans. As for the volume of benefits, they remained at a similar level to the same period of the previous year.
Specifically, cumulative contributions in the first quarter of the year amounted to 860 million, while benefits amounted to 1,106 million. Therefore, net benefits in the first quarter of 2021 amounted to 246 million euros.
The number of participant accounts stood at 9,526,160 as of March 2021, while the estimated number of participants is around eight million, as there are participants with more than one Plan.
Data by systems
The assets of the individual system reached 84,277 million euros, an increase of 2.76% over December. The number of participant accounts stood at 7,515,628.
For its part, the employment system reached a volume of assets of 36,215 million euros, an increase of 1.5% over the previous quarter. The number of participant accounts totaled 1,959,196.
Finally, the associated system had a volume of assets of €834 million, up 0.8% compared to December 2020. The number of participant accounts was 51,336.
Portfolio structure
The continuous revaluation of equity markets in recent quarters is generating an increase in the weighting of both domestic and foreign equities in the Funds' portfolios, to the detriment of other types of assets such as fixed income, with the exception of Private Fixed Income. In the case of foreign equities, this percentage already exceeds the 25% barrier from 23.9% in December 2020, and 16.9% of the total in the case of domestic equities (13.6% in December 2020). Thus, the weighting of equities in the Pension Fund portfolio is once again above its historical maximum and now represents almost 42.2% of the total.
News Source: Seguros News 26/04/2021