Dutch pension fund PME had an investment return of -23.3 per cent in 2022, its annual report has revealed.

This compares to a positive return of 3.9 per cent the previous year, with the decline attributed to negative trends in stock markets amid high inflation and rising interest rates.

During the year, the pension fund’s assets fell from €64.3bn to €49.8bn, although this was offset by liabilities also falling, from €59.3bn to €45.1bn.

PME’s current funding ratio improved from 108.3 per cent at the end of 2021 to 110.4 per cent at the end of 2022.

Meanwhile, its policy funding ratio increased from 103.2 per cent to 111.7 per cent during the same period.

Due to the improvement in the funding ratio, PME was able to increase pensions on two occasions in 2022.

Commenting on the results, PME executive board chair, Eric Uijen, said: “2022 has been an extraordinary year that many things will resonate in 2023 and beyond.

“The war in Ukraine is the most important of these. In combination with increased global economic demand after corona, that war is causing extreme energy prices.

“The result is unprecedentedly high inflation, energy poverty and economic uncertainty for our participants. The markets reacted negatively, causing billions to evaporate.

“Fortunately, indexation was possible due to the rise in interest rates.”

The CO2 emissions in PME’s equity portfolio in 2022 had fallen by 62.7 per cent compared to 2019 levels, while the CO2 emissions in its corporate bond portfolio had decreased by 32.1 per cent.

“PME is undergoing an overweight development towards a greener portfolio, in which fossil production no longer has a place,” said Uijen.

“We do not want to mortgage the future of current and future generations. They must be able to retire in a liveable world. To achieve this, we invest in energy transition, innovative solutions to combat climate change and launched our first climate plan in 2022.”

Share Story: