Romanian private pension funds driven by Stock Exchange’s robust performance
<p>The average monthly real yield&nbsp;of the mandatory private funds (Pillar 2) in Romania improved to a positive 1.9% in March, reversing the 0.5% and 0.4% negative real performances in February and January (when the inflation rates were higher), according to our calculations based on data published by the<a href="https://www.asfromania.ro/ro/a/204/evolu%C8%9Bie-indicatori?mc_cid=fa807cee73&amp;mc_eid=607bd7d763" rel="noopener" target="_blank"> Financial Supervisory Authority</a> (ASF).</p>

<p>The bright performance in March reflects the significant 7.1% advance of the BER-TR index of the blue chips traded at Bucharest Stock Exchange BVB (the index includes dividends besides capital gain), where the fund managers placed 23.9% of their Pillar 2 portfolio at the end of February (25.0% at end-March). The allocation ratio increased from 21.3% at the end of March 2023. The share of government bonds (which demonstrated comparatively lower performance recently) remains dominant, however, at 65.4% at the end of March 2024, up from 64.3% one year earlier.</p>

<p>The average monthly&nbsp;real&nbsp;yield&nbsp;over the past&nbsp;12 months to March was positive 0.8%. Therefore, the combined&nbsp;real&nbsp;annual performance of the Romanian Pillar 2 pension funds reached 9.4% y/y.&nbsp;</p>

<p>Nominally, the fund’s annual performance was 16.6% y/y, visibly driven by the 50% y/y advance of BET-TR.</p>

<p>The assets of Romania’s&nbsp;Pillar 2 pension funds increased by 30.7% y/y to RON135bn (€27bn) at the end of March 2024.&nbsp;</p>

<p>Out of the RON31.7bn increase, RON13.5bn came from new contributions.</p>

<p><em>(Photo: <a href="https://www.dreamstime.com/" rel="noopener" target="_blank">Designer 491/ Dreamstime</a>)</em></p>

<p><em>iulian@romania-insider.com</em></p>