The Third AP Fund (AP3) in Sweden returned 5.5 per cent on its investments in the first half of 2023, its half-year report has revealed.

This represents an improvement of 12.5 percentage points on the -7 per cent return in H1 2022.

AP3’s total profit for the first half of 2023 was SEK 25.7bn, up from SEK -35.3bn in the first six months of last year.

In the first half of 2023, AP3’s fund capital increased from SEK 468.4bn to SEK 491.5bn.

From the fund capital, SEK 2.6bn was paid to the Swedish Pensions Agency to cover the difference between pension contributions and pension payouts and the costs for the state pension income system in H1 2023.

The pension fund’s annualised return over the past 5 and 10 years was 8.6 per cent and 9.3 per cent respectively.

“We delivered a satisfactory return in the first half of the year, in line with our relatively cautious view on the markets,” commented AP3 CEO, Staffan Hansén.

“The economic outlook, direction of interest rates and the real economic effects of central bank tightening are marked by continued uncertainty, and we have therefore not made any major changes in our investment portfolio.”

According to AP3’s 2023 Corporate Governance report, the pension fund voted at the AGMs of 1,050 companies in 30 countries and on 13,000 motions.

AP3 chose to support most of the motions from other shareholders and voted in favour of seven out of 10 motions.

Priority issues highlighted by AP3 included how companies should incorporate sustainability criteria in remuneration plans, gender-equal boards and ambitious climate strategies.

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