AP3 reported a net result of SEK 59.5 billion in 2019, representing a return of 17.6% after expenses. Since inception in 2001, in avarage per year the Fund has outperformed the income index by 3.3 percentage points and helped to improve the financial strength of the Swedish pension system.
Highlights of 2019:
- AP3 reported a net result of SEK 59.5 billion (2.2) for 2019.
- Return totalled 17.7% (0.7) before expenses and 17.6% (0.6) after expenses.
- The Fund made payments of SEK 6,520 million (6,773) to the pension system.
- Fund capital stood at SEK 393,696 million (340,668), an increase of SEK 53,029 million from the prior year.
- The asset management cost ratio was 0.09% (0.09), of which operating expenses were 0.06% (0.06).
- Average annual return after expenses for the last five and ten years stands at 8.5% and 8.7% respectively.
- Since inception in 2001, AP3 has outperformed its long-term target of an annual average real return of 4%. Returns exceeded the income index by 3.3 percentage points during this period, meaning that the Fund has made a positive net contribution to the financial health of the pension system.
AP3 CEO Kerstin Hessius commented: “The net result of 17.6% is our best of the decade and I’m proud of the contribution we have made to the financial strength of the pension system. In the last 10 years, our average annual return has more than doubled and now stands at 8.7%, compared to 4.1% in 2010.
“Climate change is ever more important and during the first half of 2019 we performed our first scenario-based analysis of total portfolio risk measured against the 2-degree Celsius target. Analysing and monitoring portfolio climate risk better enables us to influence investee companies and to adjust our portfolio holdings. During the year we also adopted new portfolio climate goals for 2025. These included targets to reduce the portfolio’s carbon footprint and to expand our investments in green bonds.”
|31 Dec 2019||31 Dec 2018|
|Net result, SEK bn||59.5||2.2|
|Net payment to the pension system during year, SEK bn||6.5||6.8|
|Fund capital, SEK bn||393.7||340.7|
|Return after expenses, %||17.6||0.6|
|Operating cost ratio, percentage of assets under management %||0.06||0.06|
|Total management cost ratio, percentage of assets under management %||0.09||0.09|
|Real return after expenses, %||15.6||-1.4|
|Annualised real return after expenses, 10 yrs, %||7.4||7.4|
|Annualised return after expenses, 5 yrs, %||8.5||7.8|
|Annualised return after expenses, 10 yrs, %||8.7||8.5|
|Annualised income index, 5 yrs, %||2.5||2.0|
|Annualised income index, 10 yrs, %||2.4||2.7|
For further information, please contact:
Kerstin Hessius, CEO +46 (0)8 55517100
Lil Larås Lindgren, Head of Communications, +46 (0)8 55517100 email@example.com
AP3 is one of five funds that manage capital on behalf of the Swedish state pension system. The Fund had SEK 393.7 billion of assets under management as at 31 December 2019. AP3 is tasked by Parliament with generating maximum possible benefit for the state pension system by managing its fund capital responsibly and delivering strong investment returns at a low level of risk.