Private pension

Mandatory privately-managed pension funds (Pillar II) achieved in 2020 an average rate of return of 6.19 percent, three times higher than last year's inflation rate, president of the Association of Romania's Privately-managed Pension Funds (APAPR) Radu Craciun said on Monday.

154,000 pensioners with smaller pensions because of insurance payed to a private pension fund will be able to ask the National Insurance Institute to recalculate their pensions next year, provided they transfer their money for a second pension to state insurance institution. However, only one-third of people will benefit from it, for the rest the pension received will not be higher.

Processes in recent months have had an impact on returns in individual accounts managed by private pension funds as savings for a second pension.

Minister of Labour and Social Protection Violeta Alexandru and providers of private pension plans have been discussing for some time the return on investment rates offered by privately managed pension plans.

According to the head of the PM Chancellery, Ionel Danca, on Wednesday, the Government adopted the draft modifying Government Emergency Ordinance (OUG) 114 and supplementing some normative acts.

Romania's mandatory private pension funds had assets of over 55.15 billion lei on 30 June 2019, up 26.12 percent against the level recorded in the similar month of last year, according to data with the Financial Oversight Authority (ASF). Government bonds made up the largest share of the assets, namely 32.24 billion lei and a 58.46 percent share.

The mandatory private pension funds had assets worth more than 53.41 billion lei, on May 31, 2019, up 24.18 per cent against the same month a year before, according to data provided by the Financial Supervisory Authority (ASF). Government bonds hold the highest share among these assets, of 31.58 billion lei, 59.14 per cent respectively.

Mandatory private pension funds in Romania had assets worth over 52.26 billion lei on 30 April 2019, up 21.42 percent from the same level of the previous year, according to the Financial Oversight Authority (ASF) data. Government securities made up the largest share of the assets, of 30.06 billion lei, respectively 57.52 percent. Shares came in second, at 9.96 billion lei (19.07 percent).

The Government has decided a new way of calculating the minimum share capital of private pension funds, Minister of Public Finance Eugen Teodorovici announced on Thursday.

The Hungarian Democratic Union of Romania (UDMR) calls for the postponement of the entry into force of Emergency Ordinance (OUG) 114 until 2020, considering it needs amendments in relation to more than 40 points.