The asset values of the four largest occupational pension companies in Finland increased in the first quarter of 2024, although the average rate of return fell by 1.5 percentage points, data from the Finnish Pension Alliance (Tela) has shown.

During the quarter, the total investment assets of Elo, Ilmarinen, Varma and Veritas rose from €152.5bn to €156.9bn.

However, their average return fell from 5.9 per cent in Q4 2023 to 3.4 per cent in the first quarter of this year.

Equities remained the most popular asset class of the pension companies, making up 51.2 per cent of the total, an increase of 1.5 percentage points on the previous quarter.

Fixed income investments were the second most popular asset class, making up an average of 26 per cent of portfolio allocations, down from 27.4 per cent in Q4 2023.

Other investments, such as hedge funds, rose slightly to 12.6 per cent of assets, while real estate investments decreased from an average of 10.5 per cent to 10.2 per cent.

Varma remained the largest pension company by investment assets during the quarter, with Varma’s assets rising from €59.1bn to €60.9bn, while Ilmarinen’s assets increased from €58.9bn to €60.5bn.

Elo had €30.9bn worth of investment assets and Veritas had €4.6bn.

In Q1 2024, equities provided the best average return with 5.5 per cent, followed by other investments (3.1 per cent), fixed income (0.9 per cent), and real estate (0 per cent), according to Tela's statistics.

Veritas returned 3.7 per cent during the quarter, Varma returned 3.6 per cent, while Elo and Ilmarinen returned 3.3 per cent and 3.2 per cent respectively.

Tela’s statistics also included the Local Government Pension Fund (Keva) and the State Pension Fund (VER).

Keva had assets of €67.7bn and an average return of 3.7 per cent in Q1 2024, and VER had assets of €23.3bn and a return of 3 per cent.

---