Estonian pension fund assets grow 25% in a year

Assets in Estonia’s second- and third-pillar pension funds rose 25% year on year to 9.37 billion euros by the end of the third quarter, ERR reported. Third-pillar assets grew by 38%.

The second pillar holds most of the assets. Its funds had about 8 billion euros at the end of the third quarter, up from 6.5 billion euros a year earlier. Around 300 million euros of the increase came from contributions exceeding payouts, while about 1.2 billion euros reflected growth in the value of investments, Eesti Pank economist Taavi Raudsaar said.

Second-pillar funds returned 17.2% and third-pillar funds 18.7%, helped by a sharp rise in international stock markets. Raudsaar cautioned that such returns were not typical and said investors should not expect growth of 17% to 18% in the coming years.

LHV Asset Management board chairman Vahur Vallistu said all of the company’s funds had delivered positive results. He noted that publicly traded shares had been the best-performing asset class so far this year, while LHV’s largest funds were slightly behind others.

Applications to rejoin the second pillar have been accepted since November. In the first 10 days, just under 3,500 people applied, Finance Ministry adviser Kertu Fedotov said. The ministry had forecast that 26,000 people could rejoin during 2027.