“Growth of Pillar II will be sustained by a 3.5% rise in the number of contributors, to 6.5 million, and a 14% increase in contributions, of RON4.4 billion. Thus, assets on Pillar II will grow 30%, to RON25 billion,” Tintoiu said during a conference on the private pension system.
Starting March this year, contributions to Pillar II will be incraesed to 5 percentage points of total social security contributions from the current level of 4.5 points.
On the voluntary private pension segment (Pillar III), APAPR estimates assets will increase 25% this year, to RON1.3 billion.
“The system is expected to get contributions of around RON200 million and the number of contributors is expected to rise by 9%, to 375,000,” said Tintoiu.
She added 94% of the total assets managed by private pension funds in Romania, both on the mandatory and voluntary segments, were invested in Romania.
“Pension funds have around 12% of Romania’s state bonds. Pension funds are the biggest holders of public debt after banks. Pension funds also have EUR730 million in investments on the Bucharest Stock Exchange, which makes them the largets institutional investors, ensuring 10% of the local market’s liquidity,” said Tintoiu.
Mandatory private pension funds had an average yield of 8.71% last year from 11.75% in 2013 and reached total net assets of RON19.1 billion (EUR4.26 billion) in December 2014, 37% more than in 2013.
On the voluntary private pension segment, total net assets reached RON1.04 billion (EUR232 million) in December 2014, 28% more than in 2013.