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Third Swedish National Pension Fund (AP3) presents a good half-year result

Results and payments

  • AP3 recorded a net result of SEK 11,165 million (17,491) for the first six months of 2018.
  • The total return was 3.3% (5.5) before expenses and 3.3% (5.4) after expenses. The Currencies and Inflation risk categories made the largest contributions to this performance.
  • The annualised asset management cost ratio was 0.09% (0.11), of which operating expenses totalled 0.06% (0.06).
  • Fund capital rose to SEK 353,084 million (345,239 at 31 Dec 2017), an increase of SEK 7,845 million.
  • A total of SEK 3,320 million (3,687) was paid to the Swedish Pensions Agency in the first half of 2018 to cover the difference between paid-in pension contributions and outgoing pensions and to meet pension system costs.
  • AP3 has generated an annual average return of 10.1% over the last five years and 7.3% in the last 10 years.
  • Return during the period outperformed the LSP benchmark portfolio by 1.1 percentage points.


Significant investments

The Fund’s holdings of green bonds totalled SEK 15.3 billion at 30 June and accounted for 16% of the fixed income portfolio. Also, AP3 signed a $100 million investment commitment in an external unlisted insurance fund. The investment broadens AP3’s strategy to include insurance instruments in run-off and adds stability and balance to the portfolio.

Read the full report including CEO comment.

Summary of AP3’s interim results at 30 June 2018

 30-06-2018 30-06-201731-12-2017
Fund capital at 30 June, SEK bn353.1338.2345.2
Net result for the period, SEK bn 11.217.528.2
Net payment to the pension system, SEK bn3.33.77.4
Fund capital at 1 January, SEK bn345.2324.4324.4
Return after expenses, %3.35.48.8
Real return after expenses, %2.24.76.9
Asset management cost ratio, operating expenses, percentage of0.060.060.06
assets under management*
Asset management cost ratio, commission expenses, percentage of0.030.050.05
assets under management*
Total asset management cost ratio, percentage of assets under0.090.110.1
management*
Annualised return after expenses, 5.0 yrs, %**10.111.110.5
Annualised return after expenses, 10.0 yrs, %**7.35.66.1
Annualised real return after expenses, 10.0 yrs, %**6.54.55.1

* The interim report measures the asset management cost ratio on a full-year basis

** The interim report shows annualised return for 10.0 and 5.0 years respectively

 

For further information, please contact:

Kerstin Hessius, AP3 CEO, +46 855517100

Lil Larås Lindgren, AP3 Head of Communications, +46 855517123, lil.lindgren@AP3.se

The Third Swedish National Pension Fund (AP3) is one of five funds tasked with managing the Swedish state income pension system’s capital buffer to achieve an optimal return for the system. The fund had assets of SEK 353.1 billion as at 30 June 2018. AP3 has generated an annual average return of 5.9% since inception (2001-2017).