Swedish pension fund Alecta announced on Tuesday that it generated a return of 7.7 percent in the first half of 2024, while the country’s financial regulator is currently investigating losses from the fund’s previous investments, which included several insolvent regional U.S. banks.
The fund’s assets rose to 1.31 trillion Swedish kronor ($126 billion) at the end of the second quarter. Equities performed strongly, returning 12.9 percent during the period.
In 2023, Alecta lost more than $2 billion, including losses from the fund’s investments in several U.S. regional banks that collapsed last year, including Silicon Valley Bank and First Republic Bank. The fund also came under scrutiny for its stake in Heimstaden Bostad, a Scandinavian real estate group, which caused the fund to suffer a $1.2 billion loss.
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The fund’s losing streak led to the dismissal and resignation of several key executives, as well as an investigation by the Swedish Financial Supervisory Authority, which alleged that Alecta had breached a number of regulations when investing in the failed companies. In late June, Alecta received a letter with preliminary assessments from the FSA, to which the fund was expected to respond by September 6.
“We have worked intensively on developing and implementing improvement measures to strengthen Alecta while continuing to deliver high quality in day-to-day operations for the benefit of customers,” said Alecta CEO Peder Hasslev in a translated statement. “In the first half of 2024, the return was competitive.”
Alecta, Sweden’s largest pension fund, manages the pensions of 2.8 million beneficiaries, or more than a quarter of the country’s population.
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Tags: Alecta, Peder Hassley, pensions, Sweden
