While four private pension funds operated last year, as of July this year, only two such institutions will remain in Hungary. We show what the change means for members.
The private pension fund market is becoming twofold because the private sector of the MKB Pension Fund merged into the Budapest Private Pension Fund on April 1, and from July 1 the Association Private Pension Fund (formerly Allianz) merges with Horizont.
The MBH Care Pension Fund (formerly MKB) was still in effect last December decided at its general assembly about merging into the Budapest Private Pension Fund – reminded the Bank360. The former had assets of 21 billion and 3,400 members at the end of September, while the latter had assets of 42 billion and 6,000 members at the beginning of December.
Private pension fund members have nothing to do in connection with the mergerPeter Cade / Getty Images Hungary
Fewer and fewer private pension funds remain in Hungary
“As a result of the merger – in addition to the benefits from economies of scale – stable management of their retirement savings will be ensured for the members of both funds over a longer period of time” – commented Krisztián Németh, chairman of the board of directors of Budapest Magánynyugdíjpénztár, which includes the private branch of MBH Care. For similar reasons, the General Assembly of Delegates of the Association Pension Fund decided to merge into Horizont.
The inclusive Horizon the largest player in the domestic market, It currently has 34,000 members and manages HUF 159 billion. After the merger, the number of members will rise to over 42,000, and the managed assets may well exceed HUF 200 billion.
It is the only private pension fund that also provides annuities.
“We made this decision for the sake of the fund members and to ensure long-term operation,” explained Ágota Kutiné Csurgai, managing director of the Association Pension Fund, to the newspaper. The members have nothing to do with the merger, but they will have to pay membership fees in the same way to Horizont in order to achieve a permanent 70 percent membership fee payment rate. If this is not the case, the Magyar Nemzeti Bank (MNB) orders the liquidation of the fund.
It’s worth being a member
Like that we also wrote it on Dívány recently, it is worthwhile to be a member of not only a voluntary pension fund, but also a private pension fund, as those pension fund members who have decided in favor of riskier investments in recent months have already recorded double-digit gains. According to the announcement of the Magyar Nemzeti Bank (MNB). last year, the institutions achieved an average net return of 21.2 percent based on the results of the first three months.
In the case of voluntary pension fund investments, last year’s average return was also a 25-year high in the area, and almost all funds closed in double-digit gains, and the momentum has not broken this year either. Similar to voluntary pension funds in the case of private pension funds The price of the riskiest growth funds also rose the most, this year’s result so far is between 2.7-5.1 percent. Medium-risk, balanced funds are the same they achieved a more modest yield but without exception they are in surplus, only one, classic base has gone into the red.
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