Pension asset investment portfolios as of May 1, 2023

The enpf.kz website presents a report on the pension asset management of the National Bank of the Republic of Kazakhstan and investment portfolio managers (IPMs) as of May 1, 2023. A detailed report on pension savings investment is available on the enpf.kz website in the "Indicators - Investment Activity" section, which provides monthly information on pension asset management by the National Bank of the Republic of Kazakhstan (NBRK) and investment portfolio managers (IPMs). Total pension assets as of May 1, 2023, amounted to approximately 15,677.57 billion tenge. Pension assets of the ENPF, held in trust by the National Bank of the Republic of Kazakhstan, amounted to 15,668.2 billion tenge. Pension assets under IPM management amounted to 9.37 billion tenge.

Pension Asset Investment Portfolio Managed by the National Bank of the Republic of Kazakhstan

The main areas of investment for the NBRK's pension assets as of May 1, 2023, are as follows: government securities of the Ministry of Finance of the Republic of Kazakhstan – 47.38%, bonds of quasi-state companies – 10.86%, bonds and deposits of second-tier banks of the Republic of Kazakhstan – 6.98%, government securities of foreign governments – 4.60%, securities of international financial organizations – 2.43%, and corporate bonds of Kazakhstani issuers – 0.10%.

The investment portfolio by currency denominated in the financial instruments purchased using pension assets as of May 1, 2023, is as follows: investments in national currency – 70.89%, in US dollars – 29.06%, and in other currencies – 0.05% of the pension asset portfolio. An analysis of the income structure shows that interest income on securities, including deposits and reverse repo transactions, and from the revaluation of securities amounted to 508.96 billion tenge, while income from assets under external management amounted to 25.43 billion tenge, and other income amounted to 1.59 billion tenge. Foreign currency revaluation, however, resulted in a loss of 54.16 billion tenge. Thus, due to the diversification of the pension asset investment portfolio across instruments, industries, and currencies, total income for April 2023 was positive.

As a result of investment activities, as well as foreign exchange rate volatility and changes in the market value of financial instruments, accrued investment income since the beginning of 2023 amounted to 481.82 billion tenge.

The return on UAPF pension assets distributed to depositors (recipients) since the beginning of 2023 amounted to 3.13%, with inflation at 4.20%.

Moreover, as of May 1, 2023, the return on pension assets for the past 12 months (from May 2022 to April 2023) for UAPF depositors (recipients) was 8.93%.

As a reminder, positive real returns (exceeding cumulative inflation) on pension savings are ensured in the medium and long term.

A detailed breakdown of the investment portfolio of financial instruments managed by the NBRK, including issuers, and an overview of investment activities are available on the official UAPF website. As a reminder, Kazakhstan has a state-guaranteed pension savings protection model. In accordance with Article 5 of the Law of the Republic of Kazakhstan "On Pension Provision in the Republic of Kazakhstan," the state guarantees recipients the safety of mandatory pension contributions and mandatory professional pension contributions to the Unified Accumulative Pension Fund (UAPF) in the amount of actual contributions, taking into account the inflation rate at the time the right to pension payments becomes eligible.

Investment Portfolio Managers

The total amount of funds under management by the investment portfolio managers is 9.37 billion tenge.

As of May 1, 2023, pension assets under trust management by Jusan Invest JSC amounted to 4.13 billion tenge.

The company's largest investments: government securities of the Ministry of Finance of the Republic of Kazakhstan – 35.29%, Exchange Traded Funds (ETF) units – 32.73%, notes of the National Bank of the Republic of Kazakhstan – 21.87%; government securities of foreign governments – 8.80% of the portfolio. Please note that 58.40% of the portfolio is in tenge; 41.60% is in US dollars.

As a result of investment activities, as well as due to foreign exchange rate volatility and changes in the market value of financial instruments, accrued investment income for 2023 amounted to 222.61 million tenge. The return on pension assets was 5.10%.

A detailed breakdown of the investment portfolio of financial instruments managed by Jusan Invest JSC, including issuers, is available on the UAPF website.

As of May 1, 2023, pension assets under trust management by Halyk Global Markets JSC amounted to 2.56 billion tenge.

The main investments in the portfolio structure are as follows: reverse repo (up to 90 calendar days) accounts for 32.65%; bonds of quasi-governmental organizations of the Republic of Kazakhstan – 19.65%; equity instruments of foreign issuers (ETF units) – 14.84%; bonds of international financial institutions – 9.92%, notes of the National Bank of the Republic of Kazakhstan – 9.23%, securities with the status of government issued by central governments