In the first quarter of 2024, pension reserves of non-governmental pension funds (NPFs) expanded by 1.6% to ₽1.9 trillion. This growth was driven by returns on investment and the inflow of funds under non-governmental pension insurance agreements and into the long-term savings program launched at the beginning of the year.
Between January and March, nearly 270,000 people joined the program, contributing ₽2.4 billion. According to the rules of the program, co-financing from the government will amount to over ₽553 million. Furthermore, NPFs report that participants are expected to transfer more than ₽6.4 billion in pension savings to the program.
The increase in NPFs’ pension savings slowed down largely due to the transition campaign of 2023. Specifically, 68,700 persons returned to the Social Fund of Russia (SFR), whereas only 6,200 individuals opted for NPFs. The SFR’s and NPFs’ portfolios of pension savings remained unchanged at ₽2.4 trillion and ₽3.3 trillion respectively.
Additionally, returns on investment of NPFs’ pension savings have exceeded those of the SFR for five consecutive quarters. Weighted average returns equaled 9.7%. In particular, NPFs earned 7.0% on their broader portfolio and 8.4% on their portfolio of government securities. NPFs have been expanding investments in federal government bonds while reducing investments in corporate bonds and increasing their share portfolios amid rising prices.
More details are available in the Review of Key Indicators of Non-governmental Pension Funds for Q1 2024.