Timo Ritakallio, the pension provider’s new chief executive, noted that the shortfall would need to be addressed by investment returns in future, rather than increased contributions.While Ilmarinen’s long-term investment strategy foresees a reduction in fixed income in favour of both infrastructure and real estate, the fund nevertheless saw its bond and money market holdings increase to nearly 40% of assets, up by 1.1 percentage point year on year.The asset class returned 2.4% overall, with money market instrument returns at zero for the second year running.Notably, the provider saw its corporate credit portfolio decline by one-sixth over the course of 2014, citing less interest by companies to take on loans funded by pension providers due to Finland’s struggling economy.Having issued nearly €100m in new loans in 2013, the amount fell to €55.5m last year, while the overall loan portfolio shrank in size from close to €1.8bn to €1.5bn, a 17.6% drop.Ilmarinen also continued to reduce its exposure to domestic equity, with Finnish shares only accounting for 30.2% of all listed shares, a 3.4 percentage point drop.Its exposure to Japanese and emerging market stocks also reduced.However, its holdings in Chinese equity increased markedly compared with 2013, exceeding 5% of the overall equity portfolio, while exposure to European equities increased, approaching 40% of equity holdings.The rebalancing saw equities fall from being the best-returning overall asset class, gaining 10.9% last year compared with 20.9% in 2013.The return nevertheless compared favourably with the 4.9% growth of its property portfolio and the 6.8% gains from absolute return funds, which account for 40% of Ilmarinen’s €1.3bn portfolio of ‘other’ investments. The holdings, which also include commodities, returned 17.7%.Ritakallio, who was announced as president and chief executive last year, said the provider’s diversified investment strategy had “proven to be extremely successful”.Ilmarinen previously announced that FIM Group chief executive Mikko Mursula would succeed Ritakallio as CIO.Read about how Ilmarinen is using its absolute return portfolio to replicate hedge fund strategies in-house Ilmarinen boosted its exposure to China and reduced holdings in emerging markets and Japan last year, returning close to 7% over the course 2014.The increased exposure to China follows AP2’s intention to double the size of its equity mandate, after its existing portfolio returned 59% last year. The €34.2bn Finnish pensions mutual also said an increase in pensioners, stemming from baby-boomers working lives’ coming to an end, had seen it become cashflow negative.It reported a shortfall of €180m, despite contributions of €4.4bn last year.
A huge leak of data from a law firm in Panama has revealed a massive network of global leaders, celebrities and sportsmen hiding billions of dollars in assets. Millions of internal documents have been leaked from the law firm exposing how the world’s rich hide their money. The massive leak of 11.5 million tax documents reveals world leaders, sports and film celebrities, including actors Amitabh Bachchan, Aishwarya Bachchan, Jackie Chan, footballer Lionel Messi, Chinese President Xi Jinping, and Pakistan Prime Minister Nawaz Sharif.Here are 10 major facts revealed in the Panama Papers:An international coalition of media outlets, including The Indian Express, published reports described as an extensive investigation into the offshore financial dealings of the rich and famous, based on a vast trove of documents provided by an anonymous source.Nearly 11.5 million tax documents were leaked from Panama-based law firm Mossack Fonseca. The law firm is considered to be one of the top secretive law firms of the world. Founded by German-born Juergen Mossack, the firm has offices around the world and is among the world’s biggest creators of shell companies.The International Consortium of Investigative Journalism, a nonprofit organization based in Washington, said the cache of 11.5 million records detailed the offshore holdings of a dozen current and former world leaders, as well as businessmen, criminals, celebrities and sports stars.The German newspaper Sueddeutsche Zeitung said it first received the data more than a year ago. The Munich-based daily was offered the data through an encrypted channel by an anonymous source who requested no monetary compensation and asked only for unspecified security measures, said Bastian Obermayer, a reporter for the paper.Apart from Chinese President Xi Jinping, close associates of Russian President Vladimir Putin, star footballer Lionel Messi, nearly 500 Indians are also named in the explosive document leak.According to The Indian Express, Amitabh Bachchan, Aishwarya Rai, DLF owner KP Singh, Indiabulls owner Sameer Gehlaut, Vinod Adani, elder brother of Adani Group owner Gautam Adani and former Mumbai gangster Iqbal Mirchi are also named in the documents. “Amitabh Bachchan was appointed director in at least four offshore shipping companies set up in 1993. Similarly, Aishwarya Rai and her family members were registered in 2005 as directors of Amic Partners Limited. Her status was later changed to share holder before the company was dissolved in 2008. DLF promoters KP Singh acquired a company registered in British Virgin Islands in 2010. His family’s three offshore entities hold almost $10 million,” the report said.Panamanian President Juan Carlos Varela issued a statement saying his government would cooperate “vigorously” with any judicial investigation arising from the leak of the law firm’s documents. He said that the revelations shouldn’t detract from his government’s “zero tolerance” for any illicit activities in Panama’s finance industry.Panama, the Cayman Islands and Bermuda are among more than a dozen small, low-tax locations that specialize in handling business services and investments of non-resident companies.Shell companies and other entities can be misused by terrorists and others involved in international and financial crimes to conceal sources of funds and ownership. advertisement