International Finance Corporation (IFC), a member of the World Bank Group, has agreed to acquire up to 10 per cent of the shares in Romania’s Carpathia Pensions from Vienna Insurance Group (VIG).

The strategic partnership, which is subject to authorisation from the Romanian Financial Supervisory Authority, aims to strengthen Romanians’ trust in private pensions.

VIG is the majority shareholder of the private pensions company, and up to 10 per cent of the shares will be transferred to IFC upon regulatory approval.

The World Bank has been involved in reforming Romanian private pensions since the system's inception, starting with the theoretical model in 1994 to implementation in the mid-2000s.

The financial details of the proposed acquisition were not disclosed.

"The World Bank's involvement in Romania has existed since the beginning of the private pension system, and today it is all the more important as Pillar II is gradually reaching the point of offering the promised benefits to participants who reach retirement age,” said Carpathia Pensions board of directors chair, Marius Rațiu.

“At the same time, Pillar III, through voluntary pensions, is becoming increasingly interesting for generations of young people

“For us, the partnership between VIG and the World Bank is one that brings added confidence, which supports development initiatives, the digitalisation of operations and the loyalty of our clients.

“Together, we want to increase the level of awareness of the need to save through private pensions, improve financial education regarding the voluntary pension product, as well as facilitate simple, transparent and efficient access, through honest interaction, to products and services specific to private pensions.”

IFC director of the Financial Institutions Group for Europe, Latin America and the Caribbean, Vittorio Di Bello, added: “Private pensions provide people with the opportunity to save for the future, strengthen financial stability, and stimulate capital market development - essential for emerging markets and aging societies.

“Our planned investment in Carpathia Pensions aims to expand access to voluntary pensions and support market development through digital innovation and financial education.”

---