Wed, February 10, 2010 | » RATES: USD 1.42139,    EUR 1.95583,    GBP 2.22152 | » WEATHER: Sofia: -6°,   Varna: -5°,   Plovdiv: -8° | RSS | News on your desktop

Net Assets of Bulgarian Pension Funds Top EUR 1 B

Business | August 22, 2007, Wednesday

The net assets of Bulgarian private pension funds topped EUR 1 B last week, data from Bulgaria's Financial Supervision Commission (FSC) showed on Wednesday.

Since the start of the year, the assets of the private pension funds grew by 30%, but are still small compared to the function they are expected to pay in the Bulgarian economy.

The net assets of the Bulgarian pension funds totalled 3,1% of the country's gross domestic product last year at EUR 770 M, compared to figures in excess of 100% in some developed countries.

Bulgaria began a drastic overhaul of its pension system in 2002, introducing mandatory contributions to private pension funds (pillar 2 of the reform) and voluntary contributions (pillar 3), in addition to the existing mandatory contributions to the state pensions fund (pillar 1).

But several factors have prevented pension funds assets from growing strongly.

One of them is the fact that Bulgarian regulations force the funds to hold part of their assets in Bulgarian treasury bonds, whose yields have been below inflation rates in recent years.

Additionally, given Bulgaria's complex labour legislation, employees can legally avoid paying their mandatory pension contribution on their full income.

The high management fees charged by the pension funds further reduce their assets, although it does have the effect of boosting their profit.

» Subscribe to receive alerts by email for any of these keywords.
post your opinion | all opinions | save | print | send
Search forum:
Author: Robin, 22 Aug 2007 15:18:57
Net Assets of Bulgarian Pension Funds Top EUR 1 B
In my experience private pension funds are a nightmare in any country. How anyone can trust a BG company to handle their pension is beyond me. Financial services here are so over priced and with such poor service quality it all appears to be one big rip off.
Author: Kolega, 22 Aug 2007 15:47:49
Net Assets of Bulgarian Pension Funds Top EUR 1 B
Zero % capital gains tax makes a big difference.
Who cares that financial services aren't overpriced in most Western countries, when the government hits you for half?
Author: Robin, 23 Aug 2007 09:25:09
Net Assets of Bulgarian Pension Funds Top EUR 1 B
Well, actually I would say financial services are also overpriced in the west, but at least there is regulation, which means that when they do screw up they pay for it (eg the misselling scandals in UK). In BG if someone lies to you and takes your money offering 100% guarantee on your pension no one will stop them and no one will fine them later when it is clear they lied to you. Pensions require a certain amount of trust/confidence - something which is really lacking in BG (rightly or wrongly).

» More from Business:

Bulgaria Court Keeps Nationalist Councilor Yuriy Galev under House Arrest

Borisov: UK Fund to Invest BGN 100 M in Electric Car Plant in Bulgaria

A British investment fund is going to set up an electric car factory in Bulgaria’s Stara Zagora, announced Bulgarian PM Boyko Borisov, on an official visit to the UK.
Bulgaria Court Keeps Nationalist Councilor Yuriy Galev under House Arrest

Bulgaria Court Keeps Nationalist Councilor Yuriy Galev under House Arrest

Sofia Regional Court has ruled that Yuriy Galev, a nationalist municipal councilor in the Bulgarian town of Samokov, and his accomplices, are to remain under house arrest. His son will be placed under direct police supervision.

Advertisement:

A Really Bad Day

There was this guy at a bar, just looking at his drink. He stays like that for half of an hour.

Then, this big trouble-making truck driver steps next to him, takes the drink from the guy, and just drinks it all down....read

« Feb 2010 »
Mo Tu We Th Fr Sa Su
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
Bulgaria news Novinite.com (Sofia News Agency - www.sofianewsagency.com) is unique with being a real time news provider in English that informs its readers about the latest Bulgarian news. The editorial staff also publishes a daily online newspaper "Sofia Morning News." Novinite.com (Sofia News Agency - www.sofianewsagency.com) and Sofia Morning News publish the latest economic, political and cultural news that take place in Bulgaria. Foreign media analysis on Bulgaria and World News in Brief are also part of the web site and the online newspaper. News Bulgaria