National Pension Service Achieves Solid Performance with 6.35% Overall Yield Until March and 12.42% in Domestic Stocks

The National Pension Service achieved solid performance by earning 58.4 trillion won in operating profits through the first quarter of this year. Last year, the stock and bond sector suffered valuation losses of 80 trillion won, but this year, it made a profit of 60 trillion won in just three months.

The National Pension Fund Management Headquarters announced on the 30th that it recorded a 6.35% operating return until March of this year. Compared to February (5%), it increased by 1.35 percentage points. As of the end of March, the size of the fund was 953.155 trillion won.

By asset, domestic stocks (12.42%), overseas stocks (9.70%), overseas bonds (5.38%), alternative investments (3.49%), and domestic bonds (3.25%) showed the highest rate of return.

Stocks and bonds, which are traditional assets, slightly exceeded the benchmark, the standard rate of return. Domestic stocks exceeded 0.05 percentage points, overseas stocks by 0.57 percentage points, domestic bonds by 0.11 percentage points, and overseas bonds by 0.06 percentage points. The degree of beating the benchmark represents the additional rate of return earned on top of the overall market gains.

Last year, the National Pension Service recorded an estimated loss of 80 trillion won due to the shock of global inflation and the deterioration of the stock and bond markets. The annual rate of return was -8.22%, and as of December last year, the fund’s assets shrank to 890.4657 trillion won.

The National Pension Service recorded its first surplus in 13 months since December 2021 as the financial market showed a calmer trend than last year in January this year. The size of the fund recovered to the 950 trillion won range as of the end of March this year, an increase of more than 24 trillion won compared to the end of the first quarter of 2022 (928.7 trillion won).

It is analyzed that the National Pension Service has recovered its overall management performance this year as the yield on stocks and bonds rose significantly. Overseas bonds and alternative investments posted minus -0.81% and -1.76%, respectively, from last year until January of this year, but all of them succeeded in turning to black from February, reducing investment losses.

In detail, it earned more than 15 trillion won in domestic stocks by March, increasing its valuation to 140.281 trillion won. Overseas stocks were valued at 266.293 trillion won by March, earning more than 24 trillion won.

Domestic and foreign bonds both gained valuations following expectations of the Fed tightening pace. Yields rose by 1.99 percentage points for domestic bonds and 0.72 percentage points for overseas bonds, respectively.

Alternative investments made positive profits from February to March, but most of them reflected interest/dividend income and foreign currency translation gains. Actual investment performance is determined at the beginning of each year by a fair value evaluation that reflects the size of assets and investment gains and losses through an external professional agency.

Taehyun Kim, Chairman of the National Pension Service, said, “We recorded a good rate of return in a situation where uncertainties in the global economy are high due to the effects of monetary tightening and concerns about economic recession in major countries.” everything,” he said.

Meanwhile, the National Pension Service plans to restore the fund performance this year by preparing special measures such as recruiting fund management experts and improving the working environment. During the second half of this year, fund management headquarters operation experts will be recruited, and a 30-seat smart work center dedicated to the fund management headquarters will be prepared in Gangnam office building in Nonhyeon-dong, Seoul.