The deadline for the review of Sweden’s five AP funds has been pushed back by almost three months leaving the funds waiting for an answer about their future.

A review of the funds was announced in October 2023 by the Swedish Ministry of Finance, with departmental adviser, Tord Gransbo, leading it. He was tasked with looking at the AP funds’ activities, to modernise and streamline the management of the pension funds, with consolidation of the funds being an option on the table.

Initially, the deadline was set for the end of March 2024, but this has been moved to 17 June.

“An investigator will review the administrative provisions that regulate the activities of the AP Funds. The aim is to investigate and propose measures to modernise and streamline the overall management of the buffer capital,” the Ministry of Finance said in October.

AP6 CEO, Katarina Staaf, previously said the fund has “no views on how the owner chooses to organise the AP fund system”. However, she defended the work of AP6, referencing its strong results.

“We expect that whatever the solution is, our solid expertise and successful strategy in private equity will be taken into account. We have generated SEK 58bn in returns for the benefit of the pension system and over the last five years we have an average return of 16.8 per cent annually,” Staaf said.

Last month, whilst awaiting the outcome of the review, the first to fourth Swedish AP funds revealed they added SEK 142bn to the value of the Swedish income pension system in 2023, equating to a return of 8.1 per cent (after costs) combined.

https://www.europeanpensions.net/ep/Swedish-AP-funds-add-SEK-142bn-in-value-to-pension-system-in-2023.php

Furthermore, in October 2023, AP3 and AP4 announced they had jointly procured SimCorp to provide a “future proof” end-to-end system solution covering all essential parts of the business, including analysis, order placement, compliance control, administration and portfolio management, risk and return, alternative investments and financial accounting.

Commenting at the time AP3 CFO/CRO, Eva Boric, and AP4 head of risk and business support, Nicklas Wikström, said: “Our goal is to replace several old existing systems with a single comprehensive solution in order to achieve a flexible, appropriate system support. For our employees, this means that we are at the forefront and the organisation can even better and resource-efficiently support the business and processes of the business.”

“As part of the modernisation and streamlining of the two funds' system support, preparatory work has been underway to analyse and evaluate new potential system suppliers. In order to take advantage of synergies, the funds decided to carry out a joint procurement process.”

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