compenswiss with negative investment results in 2022

The year 2022 was characterized by turbulence at the political, economic and monetary level. Geopolitical tensions, especially the war in Ukraine, but also inflation and rising interest rates were at the forefront throughout the year. On the financial markets, these crises and uncertainties led to high volatility and sharply falling bond and equity markets - an unfavorable environment from which compenswiss was not spared. Manuel Leuthold, Chairman of the Board of Directors, emphasizes: "One of compenswiss' main tasks is to keep sufficient liquidity on hand so that the three social security funds can meet their payment obligations at all times. The more liquid asset classes in which compenswiss consequently primarily invests, such as bonds, equities, listed real estate funds and shares, were particularly hard hit in 2022."

Negative net return - but liquidity always sufficient

As of December 31, 2022, the total assets managed by compenswiss amounted to CHF 37,282 million (previous year: CHF 40,882 million). Assets under management consist of non-current assets, which amounted to CHF 34,599 million (previous year: CHF 38,682 million), and cash and cash equivalents (treasury), which amounted to CHF 2,683 million (previous year: CHF 2,200 million).

After taking into account currency hedging, the net return generated on non-current assets reached -12.85% at the end of 2022 (previous year: 5.28%). The net return generated on cash and cash equivalents amounted to -0.23% (previous year: -0.33%). The net returns on the assets of the three social security funds amounted to -12.38% (previous year: 4.94%) for the AHV, -11.24 % (previous year: 4.10%) for the IV and -12.21% (previous year: 5.05%) for the EO. The slightly less negative result for IV is mainly due to higher liquidity reserves.

In 2022, cash inflows, which came mainly from contributions by insured persons, employers, the self-employed and the federal government, fully covered outflows. Eric Breval, director of compenswiss, explains, "Throughout the year, compenswiss had sufficient liquidity to enable insurers to pay out pensions and other benefits without having to sell assets from their portfolio. Despite a clearly negative performance in 2022, there were no effective losses. These were merely book losses. The cumulative performance over the last ten years remains positive."

Total operating and asset management expenses (including stamp duties) are 0.20% of total assets and have remained stable compared to the previous year (0.19%).

Responsible investment policy of compenswiss to be continued

In 2022, compenswiss tightened its environmental, social and corporate governance (ESG) criteria requirements in line with its statutory obligations - liquidity, security and return. This responsible approach led to an acceleration of divestments, particularly in the coal sector. The Anstalt continued to exercise its voting rights for the Swiss shares held in its portfolio. As a member of the Swiss Association for Responsible Investment (SVVK), the Anstalt continued its shareholder dialogue and normative exclusions. It also developed measurement tools in the area of sustainability which, among other things, enable it to assess the climate compatibility of its market portfolio using the "Swiss Climate Scores" introduced by the Federal Council.

Stabilization of the AHV fund thanks to the AHV 21 reform

On September 25, 2022, the Swiss people and the cantons approved the AHV 21 reform to stabilize the AHV. The people were in favor of a gradual increase in the retirement age for women to 65 and an increase in value added tax of 0.4%. Thanks to these measures, which will come into force on January 1, 2024, the financial balance of the AHV will remain secure for another seven to eight years.

The operating results of the three social insurance schemes AHV, IV and EO for 2022 will be published in April 2023.

Source and further information