As of the end of the 2nd quarter of 2024, Austria’s eight corporate provision funds (BVKs; Betriebliche Vorsorgekassen) managed assets of € 19.80 billion. This represents an increase by € 495.6 million or 2.57% over the previous quarter, and by +6.16% since year-end 2023. The investment performance calculated by the Oesterreichische Kontrollbank for the 2nd quarter of 2024 was +0.67%, but varied between +0.09% and +0.93% between the individual corporate provision funds. During the first quarter of 2024, performance had been +1.4%, resulting in performance for the first half of +2.09%. On average over the past ten years, a return of +1.44% p.a. was achieved, and +1.12 % on average over the last five years, and -0.01% on average over the last three years. The number of beneficiaries (entitled) (including those received multiple benefits from multiple corporate provision funds) rose to 11.01 million during the reporting quarter (+50,000 or +0.45%). The average amount of the entitlement stood at approximately € 1,798 as of 30.06.2024 (compared with € 1,636 twelve months earlier). These are the findings of the FMA’s report on the state of the corporate provision funds for the 2nd Quarter of 2024 (“FMA-Bericht zur Lage der Betrieblichen Vorsorgekassen im 2.Quartal 2024”) which was published today.
Conservative Investment Strategy
The obligatory capital guarantee combined with fluctuating payment requirements in line with the development of the employment market, also by law, require an investment policy that pays particular attention to security and liquidity. At the end of Q2 2024, corporate provision funds primarily invested their assets managed in debt securities (65.25%), shares (14.95%), loans and credits (5.58%), real estate (5.71%) and cash at banks (4.68%), with the remaining amount (3.83%) in other assets. The structure of the portfolio remains largely unchanged compared with the preceding quarter.
Corporate provision funds are required to form a capital guarantee reserve to cover the guarantee prescribed under law on the paid-up capital. At the end of the reporting quarter, depending on the corporate provision fund, they stood between 0.63% and 1.15% of the total amount of entitlements, or 0.86% on average, unchanged from the previous quarter.
The full quarterly report for Q2 2024 for corporate provision funds can be found (in German only) on the FMA website at: https://www.fma.gv.at/betriebliche-vorsorgekassen/quartalsberichte/
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Klaus Grubelnik