Financial Services, Funds, Investments, Latvia, Pensioners

The association's data suggest that since the government-funded pension schemes were launched in Latvia, fund managers have earned about EUR 394 million for future pensioners. "This is net investment result, subtracting all expenses for asset management and administration," the association said, adding that preliminary profit in 2015 was EUR 37 million.

The average value of assets accumulated by a pension scheme participant reached EUR 1,862 by late 2015, growing by 15.8% or EUR 254.52 from the end of 2014.

The number of participants in Latvian government-funded pension schemes exceeded 1.254 million at the and of 2015, including 802,000 participants choosing active pension plans.

The average annual yield of government-funded pension plans in 2015 was 1.93%, including yield of conservative plans being 1.26%, yield of balanced plans being 1.43%, and yield of active plans being 2.29%.

At the end of 2015, there were seven companies in Latvia managing assets of the government-funded pension scheme and offering a total of 20 pension plans, including eight active plans, four balanced plans, and eight conservative strategy plans.

Latvia has a three-pillar pension system. The first-pillar pensions are paid to the existing pensioners from the social contributions made to the state budget. The second or government-funded pension level implies that part of the social contributions is invested in the finance sector, ensuring bigger pensions in the future. The third pillar is operated by private pension funds based on voluntary contributions.