Finnish earnings-related pension provider Ilmarinen made an investment return of 4.9 per cent in the first six months of 2024, equal to €2.9bn, its interim results reveal.

Publishing its half-year performance, Ilmarinen said the market value of its investments increased to €61.1bn. The pension provider also said that its solvency strengthened over the period, climbing to 126.7 per cent, up from 125.4 per cent.

Ilmarinen's long-term average return on investments since 1997 is 5.8 per cent.

Commenting on recent market activity and the outlook, Ilmarinen chief investment officer, Mikko Mursula, said: “The last couple of weeks have seen exceptionally large movements in the market. Recessionary uncertainty has increased and expectations of a fall in policy rates have been revised higher.

“Geopolitical tensions and the potential escalation of armed conflicts are adding to market turmoil and, together with weakening consumer confidence, are casting a shadow over the growth outlook for the global economy. However, consensus still expects the global economy to grow by more than 3 per cent this year and the Finnish economy is expected to get back on track towards the end of the year.”

Regarding cost efficiency, figures show that it continued to improve as premium income increased by 2 per cent and operating expenses decreased by 6 per cent. Premium income was boosted by growth in customer payroll. Ilmarinen paid 3,845m in pensions to around 450,000 pensioners.

Ilmarinen has reduced the annual costs of managing pension insurance by a third, or almost €50m, since 2018. At the same time, premium income has increased by 34 per cent.

“Pensions are part of public social security and we want to manage them ever more efficiently,” Ilmarinen CEO, Jouko Pölönen, said.

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