High return in a changing business environment

Alecta’s total return was 11.5 per cent in the first nine months of 2005.

Collective agreement parties the Confederation of Swedish Enterprise and the Federation of Salaried Employees in Industry and Services (PTK) have announced the commencement of new negotiations of the ITP agreement. The criteria are a competitive plan where the individual is given greater influence over the choice of pension provider. Alecta’s President, Tomas Nicolin, comments: “I believe that there are three factors that should prove decisive when individuals make their choice. These are the pension provider’s ability to create returns, financial position and costs. A five-year return that is clearly above the industry average, strong funding and the lowest costs in the industry, put us in a good starting position.” Total return was 11.5 per cent in the first nine months of 2005. The industry’s total return had not yet been published at the time of writing. The funding base rate, the interest rate used for calculating collective funding, was reduced once again during the third quarter as a result of falling market interest rates. This time the reduction was 0.25 percentage points to 3.25 per cent. The reduction of the base rate had a 4 percentage points negative impact on funding while the return made a positive contribution. Taken overall, the funding ratio fell by two percentage points to 127 per cent compared with the end of the first half of the year. You are welcome to access our interim report at www.alecta.com. For further information, please contact Tomas Nicolin, President, Alecta, telephone +46 8 441 60 50 Cecilia Schön Jansson, Senior Vice President, Communications, Alecta, telephone +46 8 441 93 50, +46 70-526 93 50