The private pensions sector has become the segment of Romania's non-banking financial market with the largest capitalization, around 7% of GDP, Nicu Marcu, president of the Financial Supervision Authority (ASF) commented.

He praised the sector's dynamics, which he attributed to the sound institutional framework.

Boasting total assets of about RON 73 billion (nearly EUR 15 bln) as of October 2020, the private pension funds have surpassed the open investment fund segment (OPCs), which mainly includes the mutual funds.

The net assets managed by the private pension funds in Romania - RON 70.2 bln in Pillar II funds and RON 2.7 billion in Pillar III - as of the end of October 2020, hit 7.0% of the GDP, according to the latest data released by ASF and the statistics office INS.

This is more than double compared to the level measured in 2014.

"I said, at the beginning of my term, that the private pension sector is the best regulated sector. Since their launch, the assets of private pension funds have increased exponentially, we can say at this moment that the growth rate of the assets of private pension funds has reached 19%," said Nicu Marcu, quoted by Ziarul Financiar.

The official data reveals a slightly lower growth rate of the net assets under the management of the private pension managers, 17% year-on-year for Pillar II, and 12% year-on-year for Pillar III.

These growth rates sum up the effects of new contributions and the rise in the fund units' net asset value (the yield of the funds).

ASF reports average yields of 4.3% year-on-year, as of October, for the Pillar II funds and 3.5-4.0% yields for Pillar III funds.

The Pillar III funds have constantly performed weaker compared to the Pillar II funds in Romania.

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andrei@romania-insider.com