Second AP Fund performs strongly to exceed targeted portfolio return, both short and long-term

The Second Swedish National Pension Fund/AP2 posted a net result of SEK 30.1 billion for the year and, after payments to the national pension system, Fund capital totalled SEK 264.7 billion. The Fund’s return on the total portfolio for the year, excluding costs, was 12.8 percent. Return relative benchmark index, excluding alternative investments and costs, was 0.4 percent.

Consequent to the Second AP Fund’s strong performance over the year, return on investment exceeded the targeted average long-term annual real return of five percent. In the past five years, the Fund’s annual real return has totalled 9.8 percent and, over the past ten years, 5.8 percent. 2013 was a good year, especially with respect to the Fund’s investments in unquoted and market-listed equities. For the fifth year in succession, net flows to the pension system were negative and the Fund has now paid out a total of SEK 19.8 billion to cover the shortfall in the pension system.

• The Second AP Fund’s assets under management totalled SEK 264.7 (241.5) billion on December 31st 2013, against which net outflows to the national pension system were charged in an amount of SEK –6.9 (–3.8) billion.
• The Fund posted a net result for the year of SEK 30.1 (28.6) billion.
• The Fund’s return on the total portfolio was 12.8 (13.5) percent, excluding commission costs and operating expenses. Including these costs, the portfolio generated a return of 12.7 (13.3) percent.
• Operating expenses in terms of asset management costs remained low, totalling 0.07 (0.07) percent for the period.
• The relative return on the portfolio of listed assets, excluding alternative investments and costs, amounted to 0.4 (1.1) percent. For the last five years the average relative return has been 0.54 percent.
• Return on alternative investments was 13.4 (13.9) percent.

“This year’s result is the second highest recorded since the Fund was established. But what you see on the bottom line in any given year is not the most important thing. What is important is that we achieve a stable long-term return over time, for all generations. The 2013 result means that we have exceeded our targeted return for the past five and ten years by a good margin,” says CEO Eva Halvarsson, Second AP Fund.

 
The English version of the AP2 Annual Report 2013 will be available at www.ap2.se from the beginning of March.

 
For further details, contact CEO Eva Halvarsson, Second AP Fund, on 46 (0)31-704 29 00 or Ulrika Danielson, Head of Communication, on +46 (0)31-704 29 29.

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