€65m gross investment return in 2016

The Fund of Kosovo Pension Savings Trust (KPST) concluded one more year with positive results in all areas of operation. From 2002 until the close of 2016, gross return on KPST investments has reached about 305 million euros with an increase in share price over the same period of 38%. And for year 2016, the gross investment return was around 65 million euro, with the share price increasing by 4.4% for the year 2016. This positive result was achieved in a year that proved particularly challenging due to an environment of very low interest rates where low-risk assets were not sufficiently rewarded, to European equity markets facing the uncertainty of the Brexit outcome, and to global equities proving quite nervous in the face of US presidential elections and of an eventual change in the FED’s monetary policy. In spite of the volatility and the challenges, financial markets did well, with many indices moving into positive territory just in the last month of the year. This performance was supported by the gradual improvement of economic indicators at the global level, together with some increase in oil prices.

In this case the Governing Board was well satisfied with the investment performance, which proved the consistency and the effectiveness of the investment strategy in force, offering a combination of stability and return through balanced investments and diversification.

Assets under management

Apart from investment performance, this year KPST had a record growth of assets under management and collected contributions. KPST has also continued with service improvement to the contributors, expanding the service with four commercial banks for the phase withdrawal, while the number of participants grew significantly.

At the end of 2016 the net assets that the KPST had under management came to the value of 1.42 Billion or an increase of 189 million euros from the end of last year. The growth of assets under management was the result of: new contributions of 152 million euros and return on investment of 65 million euro. While for the same period: 19 million euro was paid for the pension, 6 million euro for the management fees and 2 million euro were refunded.

With the growth of assets under management, KPST has continued to look for increased diversification through selected investment opportunities, engaging in 2016 three additional multi-assets funds from three fund managers (two new and one existing): BNP Paribas IP Parvest, Amundi and Schroders.

The retirees

This year there were 4.447 more new beneficiaries of pensions, amounting to a withdrawal of around 19 million euro. Since its establishment until now, the number of retirees went to 33.609 and the value that these pension beneficiaries withdrew has been around 91 million euro.

The contributors

The number of the contributors achieved its strongest growth in 2016. The total number of accounts grew by 33.960 and reached 541.923. While the number of active accounts grew by 15.235 and reached 312.681. Detailed reasons for the total and active number of contributors will be presented in the 2016^th Annual Report.

Number of contributors by type of enterprise*

*One person could be presented to more than one type of enterprise.

The table below shows a summary of the key facts for the last two years: