Sweden’s Kapan Pension, for government employees, made a return of 8.6 per cent on its investments in 2023.

The pension fund, which manages over SEK 130bn of assets with over 900,000 members, said the year was characterised by “conflicts and uncertainty”.

Kapan Pension said its equity and interest-related investments rose in value in 2023. However, the positive development in these areas was, to some extent, counteracted by a negative return on investments in real estate, as a result of the rapid increase in interest rates in recent years.

“Central banks continued to raise interest rates at the beginning of the year but market expectations quickly shifted during the autumn to a belief in rapid reductions in the coming years,” the pension fund stated.

Kapan Pension reported a strong balance sheet with a solvency ratio of 246 per cent. The average five-year return on its assets is 7.6 per cent.

“The aim over time is to continue to develop and adapt operations to a changing environment and to be able to offer long-term, responsible and sustainable management of members' paid-in premiums and total pension capital,” it stated.

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