Three Eastern European funds that were suspended due to the war in Ukraine have now been deregistered from the Swedish premium pension fund market, the Swedish Pensions Agency (SPA) has announced.

Following their deregistration, the agency has taken over the management of the fund shares.

The SPA said that the intention was to later redeem the fund shares to recover as much value as possible for pension savers and pensioners.

The funds affected are the Baring Eastern Europe A, BlackRock – Emerging Europe A2, and East Capital Eastern Europe.

There are 14,950 pension savers and pensioners who have chosen one of the Eastern European funds and are affected by the buyback decision.

Those affected will get an initial value back of 25 per cent of the funds’ current valuations in the premium pension system, although the SPA expects to get a higher value when the funds can be sold, and will then distribute the surplus to the funds’ savers and pensioners.

However, the authority warned that a complete decommissioning could take several years.

“The Eastern European funds' long-term trading halt is a consequence of their exposure to Russia and the Moscow stock exchange,” commented SPA head of fund trading, Rasmus Bjälkeson.

“We now buy the funds from every saver and pensioner in order to unlock the premium pension accounts.

“In this way, all fund selections, deposits and withdrawals that are now in the queue can be let through.”

The funds were deregistered after the Fund Market Board’s decision that they did not meet the conditions for a fund agreement, primarily because the funds have not been able to be traded for over a year.

The trading halt has also locked the pension savers' accounts for all other transactions, for example the exchange of other funds in the portfolio.

“To the savers in East Capital and Baring, we have good hopes of being able to return more money to the savers in the coming six months, but complete redemption may take several years,” Bjälkeson added.

“However, those who have chosen funds with heavy investments in Russia have had noticeable effects on their premium pension capital.”

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