Pension savings of each depositor and recipient of the UAPF are made up of contributions received to an individual pension account and accrued investment income.
Pension asset Managers (National Bank of the Republic of Kazakhstan and Investment Portfolio Managers (IPM)) in order to obtain investment income, pension assets are placed in Kazakhstan and abroad in various financial instruments in various sectors of the economy, in different currencies. Such diversification ensures the safety and sustainable profitability of pension savings. Investment income consists of income in the form of remuneration on securities (deposits and other transactions), income in the form of market and currency revaluation of financial instruments, income on assets under external management, etc.
Income from market and currency revaluation can be either positive or negative in a particular period. Therefore, as a result of investment activity due to the volatility of foreign exchange rates and changes in the market value of financial instruments, the amount of accrued investment income may vary. Depositors and recipients can observe an example of this from the beginning of 2022.
Pension savings are invested in financial instruments in different currencies. As of March 1, 2022, about 2/3 of investments are placed in tenge and about 1/3 - in foreign currency, most of the foreign currency investments are in US dollars. Accordingly, the dollar exchange rate is reflected in investment income as part of pension assets: with the strengthening of the national currency, investment income may decrease, with an increase in the dollar rate, it may grow.
As you know, the revaluation of the value of pension assets is carried out on a weekly basis as of the end of the first working day of the week and at the end of the last calendar day of the month.
From January to the beginning of March 2022, the tenge exchange rate weakened against the US dollar from 431 tenge to 495 tenge. Then, in mid-March, the dollar exchange rate rose to 512 tenge. Thus, there was a positive currency revaluation of pension assets on a weekly basis. Depositors have seen significant positive investment income in their individual retirement accounts.
By March 24-25, 2022, the exchange rate of the national currency strengthened to 495 tenge per dollar. On March 24, 2022, a revaluation was carried out taking into account changes in the currency component of the portfolio of pension assets, as well as taking into account the accrual of negative market revaluation on assets, including those under external management.
The entire system of investment management and accounting of pension assets is transparent: each depositor has the opportunity to see his investment income in his personal account on the enpf website.kz or in the mobile app 24/7.
If you have decided to use part of your pension savings for housing, medical treatment or transfer to an investment portfolio manager, we recommend checking up-to-date information about your pension savings, including information about the available amount, immediately before submitting an application to an authorized operator for receiving lump-sum pension payments or an application for the transfer of a pension. In order to avoid refusal to use pension savings, we also recommend taking into account that on a weekly basis, as of the end of the first working day of the week and at the end of the last calendar day of the month, the value of pension assets is revalued.
It is important to emphasize that pension savings are long–term investments and it is advisable to analyze the amount of investment income for a period of at least one year. Short–term data (weekly, monthly, etc.) are not indicative, because they depend on constant current changes in market conditions.
For example, the amount of net investment income for 2021 distributed to the IPS of depositors (recipients) amounted to about 1.4 trillion tenge, which exceeded the amount of contributions received for the year (1.3 trillion tenge). The yield on pension assets of the UAPF in 2021 under the management of the National Bank of Kazakhstan since the beginning of the year amounted to 11.13% (which is higher than the yield on term bank deposits), with inflation of 8.4%.
As a result of investment activity, as well as due to the volatility of foreign exchange rates and changes in the market value of financial instruments, the amount of accrued investment income since the beginning of 2022 amounted to 534.52 billion tenge. The profitability of the pension assets of the UAPF, distributed to the accounts of depositors (recipients) since the beginning of 2022, amounted to 4.00% with inflation of 1.50%. Thus, the real yield on the pension assets of the UAPF was 2.50%.
In general, in accordance with the Law on Pension Provision of the Republic of Kazakhstan, the state provides a guarantee of the safety of pension savings taking into account inflation at the time of obtaining the right to pension payments. This norm, which has no analogues anywhere in the world, contributes to the preservation of depositors' savings from inflation. When transferring pension savings to the management of the UIP, the guarantee of the state is replaced by the guarantee of the management company to ensure a minimum level of profitability of pension assets.
UAPF was established on August 22, 2013 on the basis of JSC "NPF "GNPF". The founder and shareholder of the UAPF is
The Government of the Republic of Kazakhstan represented by the State Property and Privatization Committee of the Ministry of Finance of the Republic of Kazakhstan. The trust management of pension assets of the UAPF is carried out by the National Bank of the Republic of Kazakhstan. Since January 1, 2016, the functions of developing proposals to improve the efficiency of pension assets management have been transferred to the National Fund Management Council. In accordance with the pension legislation, the UAPF attracts mandatory pension contributions, mandatory occupational pension contributions, voluntary pension contributions, pension payments, individual accounting of pension savings and payments, provides the depositor (recipient) with information on the status of his pension savings (more on www.enpf.kz )