Volatility hits Irish pensions fund

The volatility in global markets in recent months saw investment returns for the pensions reserve fund fall by 0.9 per cent in the third quarter.

The National Pensions Reserve Fund today said the fund's value was €21.26 billion, with an investment return of 5.9 per cent over the year to date.

Dr Michael Somers, chief executive of the National Treasury Management Agency (NTMA), which manages the fund, said despite the volatility in global markets in the third quarter of the year, the fund posted a solid investment performance.

But he warned that the increased volatility in global investment markets and tighter credit could lead to lower economic growth in developed economies that could impact on corporate earnings.

The statement added that the fund has invested €156 million in three private equity investment vehicles and €35 million in a property investment vehicle. The fund has more than €1 billion invested in property.

The fund was set up in April 2001 to meet pension and social welfare costs from 2025 onwards. The Government invests the equivalent of 1 per cent of GNP in the fund annually in four quarterly installments.

This year the Government is investing around €1.6 billion.