Top pension fund assets almost double in 10 years
The
According to the research, defined benefit (DB) funds account for 67% of total assets, down from 75% five years ago. During 2014, defined contribution (DC) assets grew the most, by almost 5%, followed by DB plans assets (almost 4%) and reserve funds2 (over 1%), while hybrid plan assets decreased by over 2%.
“Despite significant asset growth over the past decade, there is a
growing feeling that the investment industry has not focused enough on
the end beneficiaries’ needs or on managing costs in the ‘investment
food chain,’” said
According to the research, the U.S. remains the country with the largest
share of pension fund assets, accounting for around 38%, while
“The gradual reduction of extraordinary measures from central governments, which has underpinned equity markets since the financial crisis, is now being felt. Without quantitative easing tailwinds, markets are arguably back to functioning normally, which will reinforce many big funds’ belief in the value of being well diversified, particularly at times of stress, which we are again seeing. As such, we expect mature funds to accelerate diversification away from equities and into other asset classes as they continue to de-risk their portfolios and focus on total returns,” said Carlson.
Sovereign pension funds3 continue to feature strongly in the
ranking, with 27 of them accounting for 28% of assets and totaling
around
“Many large funds have been making significant changes to the way they invest. This is in line with a single-minded approach of working hard in added-value spaces to find the extra returns that no longer come from the market. In the process, they are increasingly thinking about diversification in the context of all return drivers and adding the necessary governance or outsourcing to ensure success,” said Carlson.
Top 20 pension funds (USD millions) |
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Total | Defined | Defined | |||||||||
Rank | Fund | Country | assets | benefit | contribution | ||||||
1. | Government Pension Investment | Japan | $1,143,838 | $1,143,838 | |||||||
2. | Government Pension Fund | Norway | $884,031 | ||||||||
3. | National Pension | South Korea | $429,794 | $429,794 | |||||||
4. | Federal Retirement Thrift | U.S. | $422,200 | $422,200 | |||||||
5. | ABP | Netherlands | $418,745 | $418,745 | |||||||
6. | California Public Employees | U.S. | $296,744 | $294,951 | $1,793 | ||||||
7. | National Social Security | China | $247,361 | ||||||||
8. | Canada Pension | Canada | $228,431 | 1 | $228,431 | ||||||
9. | PFZW | Netherlands | $215,006 | 1 | $215,006 | ||||||
10. | Central Provident Fund | Singapore | $207,872 | $207,872 | |||||||
11. | Local Government Officials | Japan | $194,696 | $194,696 | |||||||
12. | California State Teachers | U.S. | $186,954 | $186,409 | $545 | ||||||
13. | Employees Provident Fund | Malaysia | $184,697 | $184,697 | |||||||
14. | New York State Common | U.S. | $178,252 | $178,252 | |||||||
15. | New York City Retirement | U.S. | $158,702 | $158,702 | |||||||
16. | Florida State Board | U.S. | $154,657 | $145,819 | $8,838 | ||||||
17. | Ontario Teachers | Canada | $133,282 | $133,282 | |||||||
18. | Texas Teachers | U.S. | $128,933 | $128,933 | |||||||
19. | GEPF | South Africa | $123,204 | 2 | $123,204 | ||||||
20. | ATP | Denmark | $122,028 | $122,028 |
1 | As of March 31, 2015 | |
2 | As of March 31, 2014 | |
Sovereign pension funds (USD millions) |
||||||||||||
|
|
|
|
Defined | Defined | |||||||
Rank |
Fund |
Country |
Total assets |
benefit | contribution | |||||||
1. | Government Pension Investment | Japan | $1,143,838 | $1,143,838 | ||||||||
2. | Government Pension Fund | Norway | $884,031 | |||||||||
3. | National Pension | South Korea | $429,794 | $429,794 | ||||||||
4. | National Social Security | China | $247,361 | |||||||||
5. | Canada Pension | Canada | $228,431 | 1 | $228,431 | |||||||
6. | Central Provident Fund | Singapore | $207,872 | $207,872 | ||||||||
7. | Employees Provident Fund | Malaysia | $184,697 | $184,697 | ||||||||
8. | GEPF | South Africa | $123,204 | 2 | $123,204 | |||||||
9. | Future Fund | Australia | $89,170 | |||||||||
10. | Employees' Provident | India | $80,741 | 2, 3 | $80,741 | |||||||
11. | National Wealth Fund | Russia | $75,344 | 4 | ||||||||
12. | Labor Pension Fund | Taiwan | $64,784 | $21,117 | $43,667 | |||||||
13. | Public Institute for Social Security | Kuwait | $58,895 | 1, 3 | ||||||||
14. | Fondo de Reserva Seguridad | Spain | $50,377 | |||||||||
15. | FRR | France | $45,012 | |||||||||
16. | AP Fonden 3 | Sweden | $40,717 | |||||||||
17. | AP Fonden 4 | Sweden | $37,128 | |||||||||
18. | AP Fonden 2 | Sweden | $37,018 | |||||||||
19. | AP Fonden 1 | Sweden | $35,980 | |||||||||
20. | AP Fonden 7 | Sweden | $29,329 | |||||||||
21. | Ireland Strategic Investment | Ireland | $25,410 | 1 | ||||||||
22. | Zilverfond | Belgium | $25,116 | |||||||||
23. | State Pension | Finland | $21,296 | $21,296 | ||||||||
24. | New Zealand Superannuation | New Zealand | $18,306 | 5 | ||||||||
25. | Social Insurance Funds | Vietnam | $17,283 | |||||||||
26. | FEFSS | Portugal | $16,340 | |||||||||
27. | Fonds de Comp./Securite Sociale | Luxembourg | $16,250 |
1. |
As of March 31, 2015 |
|
2. |
As of March 31, 2014 |
|
3. |
Estimate |
|
4. |
As of Jan. 1, 2015 |
|
5. |
As of June 30, 2014 |
|
Towers Watson Investment
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About
1 Estimation is based on the P&I/
2
Reserve funds are set aside by a national government to guarantee
pension payments and are characterized by no explicit liabilities and
hence are neither DB nor DC.
3 As established by
national authorities for the meeting of pension liabilities. We
acknowledge that there are many other state-sponsored funds established
— we have attempted to restrict this to funds specifically sponsored by
national authorities.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150908005982/en/
Source:
Towers Watson
Media Contact:
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eemerman@eaglepr.com