The Bank of Russia has announced plans to gradually increase the threshold for passing stress tests for non-governmental pension funds (NPFs) from 75% to 95% by January 1, 2030. This move is part of a draft ordinance aimed at enhancing stress testing as a primary tool for assessing NPFs’ risks. The draft has been released for public consultation.
Under the new guidelines, if an NPF passes less than 95% but no less than 75% of the tests, it will be required to improve its performance within nine months. These changes are intended to ensure the financial resilience of NPFs in most non-standard situations covered by the Bank of Russia’s stress scenarios and protect clients’ money.
The document also updates methods for assessing the value and estimating cash flows from certain types of deposits and bonds, as well as swap contracts with interest rates as an underlying asset.
This draft ordinance marks the first step towards reforming NPFs’ investment activity. It includes easing requirements for the composition and structure of their portfolios while simultaneously tightening stress testing requirements to limit risks. The Bank of Russia plans to present a draft ordinance containing new requirements for pension reserves soon.
