Pension assets accumulated in the accounts of investors in UAPF, as of April 1, 2020 exceeded 11.7 trillion tenge. At the same time, the investment income in the structure of pension accumulations of citizens accrued for the period of managing the UAPF assets by the National Bank of the Republic of Kazakhstan from September 2013 [1] amounts to more than 30% (or 3.9 trillion tenge).
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, and it must be considered in the long term.
For example, over the past 2019, the net investment income accrued on the IPS of UAPF depositors amounted to 641.8 billion tenge, the yield was 6.57% with inflation of 5.4%. In 2018, the net investment income of depositors amounted to 977.2 billion tenge, profitability amounted to 11.27% with inflation of 5.3%. Thus, profitability indicators can vary by year, but at the same time exceed inflation, i.e. The real return on pension assets is positive.
Since the beginning of 2020, as of April 1, over 661.7 billion tenge of investment income was accrued on the IPS of investors, which is 564.8 billion more compared to the same period last year (96.9 billion tenge). In general, investment income is not fixed, depending on the value of financial instruments and the situation on the financial market as a whole. A temporary decrease in investment income from individual financial instruments is offset by the diversification of the entire investment portfolio of pension assets over a longer period.
The main principle of investing pension money is their safety, i.e. minimization of risks of their loss for any reason. Therefore, pension assets are invested in various types and, at the same time, the most reliable financial instruments that domestic and foreign stock markets can offer. The higher the return - the higher the risk of loss of investment, the lower the risk of loss of investment - the lower the return. When choosing financial instruments for investing pension assets, the National Bank of the Republic of Kazakhstan seeks to ensure the most reasonable balance in the risk-return ratio.
In addition, the law on pension provision provides a state guarantee for the preservation of pension savings, which applies to all pension contributions, taking into account the level of inflation at the time of receipt of the right to payments.
UAPF was established on August 22, 2013 on the basis of JSC NPF GNPF. The UAPF founder and shareholder is the Government of the Republic of Kazakhstan represented by the State Institution “Committee of State Property and Privatization” of the Ministry of Finance of the Republic of Kazakhstan. UAPF pension assets are managed by the National Bank of the Republic of Kazakhstan. From January 1, 2016, the functions for developing proposals to improve the management of pension assets were transferred to the National Fund Management Council. In accordance with the pension legislation, the UAPF attracts mandatory pension contributions, mandatory professional pension contributions, voluntary pension contributions, pension payments, individual accounting of pension accumulations and payments, provides the depositor (recipient) with information on the status of his pension accumulations (for more information visit www.enpf.kz )