A clear answer must be given to the question of what prevents pension assets from being invested effectively, Prime Minister Vladimir Putin said yesterday.
The regulator's reaction was swift. "We are working to increase the number of long-term financial instruments that NPFs (non-government pension funds) can acquire," responded Vladimir Milovidov, the head of the Federal Financial Markets Service (FSFR). The Service "ardently supports" the idea of investing pension savings in mortgage and mortgage securities. In Milovidov's opinion, infrastructure bonds bought with NPF money can finance long-term projects. In 2010-2011, NPFs may have an opportunity to hedge risks and invest in derivative instruments.
Pension money should not only be used for economic development, but should also be "reliably protected and should bring income to all those involved in the process," Putin ordered, thus adding further fuel to a dispute between managers and NPFs that has been running for more than a year. While the former claim that under a law which they believe is applicable to this situation they cannot guarantee profitability and even safety, the latter demand a guarantee of safety, repayment and profitability by citing another law.
In this dispute, the FSFR takes the side of NPFs. "We believe that the requirements for management companies should be toughened and their responsibilities should increase," Milovidov said. "Coordination of the rights of the insured, the obligations to them and the assets is a very pressing issue. We are in favour of disclosing the results of MPF's activities, even if they are negative, not hiding them, but the obligations that the funds have to their depositors must be protected by a variety of measures."
In 2008, even government bonds returned losses, recalls Troika Dialog managing company president, Pavel Teplukhin. Annual calculation of profitability under current rules kills the idea of long pension money, turning it into speculative capital, he says.
Daniil Zhelobanov