Swedish pension provider Alecta reported a 5.9 per cent return on its investments in Q1 2025, a 0.9 per cent decrease from 2024.

The provider's latest results showed that its financial position had worsened slightly, as the solvency and the collective consolidation level within the defined benefit (DB) insurance fell from 202 per cent to 197 per cent and 162 per cent to 161 per cent, respectively.

Meanwhile, managed capital in the total portfolio for defined benefit insurance amounted to SEK 1,002bn at the end of March, while total capital managed by Alecta was SEK 1,301bn.

The group's management expense ratio was 0.07 per cent, the same as in the same period in 2024, but it was reduced slightly to 0.026 per cent from 0.028 per cent in the first quarter of last year.

Despite declining profits, the group's five-year returns remain high, with an average total return of 8.7 per cent per year for Alecta's optimal pension.

The provider has been under increased scrutiny recently.

Sweden's Financial Supervisory Authority (FI) launched an investigation into Alecta's risk management after the group revealed losses of SEK 20bn following turbulence in the US banking market in 2023.

The supervisory authority later extended its investigation into Alecta to determine whether it followed the correct regulations regarding its investments in Heimstaden Bostad.

This investigation found that the pension provider had "violated several regulations" in relation to its investments.

However, the group said that, since autumn 2023, it has worked "hard" to ensure better risk management, governance and competence, particularly in asset management.

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