The assets of Swiss pension funds reached around 1.2 billion Swiss francs (1.2 billion euros) in 2021 thanks to a return on invested capital of 85 billion Swiss francs, according to a report by the association of asset management country AMAS.
On average, Pensionskassen posted investment returns of 8% last year, the second best result to date. In 2019, pension fund investment returns added 95 billion francs in assets, the best result to date, and 43.5 billion francs in 2020.
Typically, at the end of 2021, pension funds had 31% of their assets invested in equities, 32% in bonds, 22% in real estate, 12% in alternative and other investments and 3% in cash.
According to the report, with a riskier asset allocation strategy – for example 40% equities, 20% bonds, 17% real estate, 20% alternative investments and 3% cash – the annual returns of Pensionskassen since 2006 would have been higher by 0.45% per year, generating an additional CHF 69 billion over this period.
Over the past five years, however, returns on invested capital have contributed over CHF 250 billion to the increase in pension fund assets, and over the past 10 years to CHF 430 billion. .
Over the past 15 years, according to the report, all asset classes have generated positive returns. Swiss equities generated 6.96%, foreign equities 5.41%, Swiss bonds 2.01%, foreign currency bonds 1.96%, real estate 5.64% and alternative investments and other 5, 50%, the report adds.
Contributions from employers amounted to 30 billion francs and those from employees to 21 billion francs in 2021, according to figures from the Swiss commission for the supervision of occupational pensions OAK, AMAS and the Federal Office of the statistics.
The number of active members of Swiss pension funds is currently 4.6 million, plus 1 million retirees, which means that each member holds on average almost CHF 214,000 in pension assets in Switzerland, i.e. approximately CHF 133,000 per inhabitant.
That number is higher than CHF110,606 per member held in pension assets in the Netherlands, CHF98,328 in Australia, CHF95,963 in the United States and CHF80,650 in Canada, according to the Thinking Ahead Institute and AMAS.
Last year, each member of the pension fund benefited from the increase in assets by an average of CHF 15,180, based on a return of CHF 85 billion.