Chile Pension Fund Managers Cut Investments Abroad 22.8% In 3Q
November 15 2011 - 10:49AM
Dow Jones News
Chile's private pension-fund managers, or AFPs, reduced their
investments abroad 22.8% to $46.95 billion in the third quarter,
versus the prior three-month period, government regulator SAFP said
Tuesday.
AFPs, Chile's largest institutional investors, decreased their
exposure in overseas equities and fixed-income markets as concerns
about Europe's sovereign debt crisis battered global markets.
"Uncertainty created by Greece's rescue plan and by the risk of
insolvency in countries like Ireland, Portugal, Spain and Italy had
a negative impact on equities markets, especially considering the
risk of contagion in the rest of the euro zone and its negative
impact on global economic activity," SAFP said.
Overall, the AFP funds held $132.66 billion at the end of
September, of which 35.4% was invested abroad.
After recent regulatory changes, AFPs can now invest up to 80%
of their assets abroad.
Of the AFPs' consolidated investments abroad, some 67% are in
equities, while the remainder is in fixed-income, SAFP said.
Of the overall investments abroad by AFPs, only 6.4% are in
"developed Europe," 27.6% in the U.S., and 26.7% in emerging
Asia.
The largest group of funds managed by the AFPs, known in Chile
as the Type C-fund and which includes both fixed-income and equity
instruments, held 30.3% of its assets, equivalent to $16.47
billion, abroad at the end of September.
Among individual funds, the highest-risk A Funds had 64.9% of
their assets, or $15.94 billion, invested overseas as of Sept. 30;
the B Funds had 44.9% of total assets abroad, or $11.07 billion;
the D Funds had 17.4% of overall assets, or $3.4 billion, in
international markets; and the lowest-risk E Funds had 1.8%, equal
to $178 million, abroad.
AFP Provida SA (PVD, PROVIDA.SN), which managed the largest
portfolio at the end of September, had 34.7% of assets invested
abroad, equal to $13.47 billion. Provida is 51.6% owned by Spanish
bank Banco Bilbao Vizcaya Argentaria SA (BBVA, BBVA.MC).
AFP Habitat (HABITAT.SN), Chile's second-biggest AFP, held 33.6%
of its assets, or $11.29 billion, overseas at the end of
September.
Number three AFP Capital had 34.1% of total assets, equal to
$9.96 billion, invested in international markets. Capital was
created in 2008 after Dutch banking group ING Groep NV (ING,
INGA.AE) bought Banco Santander SA's (STD, SAN.MC) AFP Bansander
and merged it with its AFP Santa Maria.
-By Anthony Esposito, Dow Jones Newswires; 56-2-715-8929;
anthony.esposito@dowjones.com