Dutch Low-cost DC Schemes Approach €10bn In Assets

Published date: .

The invested capital run by PPIs – low-cost defined contribution schemes – in the Netherlands amounted to €9.7bn at the end of the first quarter of this year, marking a growth of 20% compared to the fourth quarter of 2018.

According to data from Dutch regulator De Nederlandsche Bank (DNB), the number of active members increased by 11% in the same period to almost 44,000. 

Almost half of the capital increase, €814m, was from returns on investment, while 30% (€503m) was attributed to newly transferred pension plans. More than a quarter of the increase (€429m) was from contributions.

The growth of 20% compared to the previous quarter was the largest increase since the end of 2015. Compared to a year earlier, the PPIs saw their combined assets under management grow by 40%.

This was more than the 32% increase recorded for the same period a year earlier, but a lot lower than previous annual growth, with data showing increases of 64% in 2017, 107% in 2016 and 202% in 2015. This concerns the total amount of invested capital at members’ risk. 

PPIs still manage only a fraction of the capital invested across all workplace pension plans in the Netherlands. According to DNB, the invested capital at the end of the first quarter amounted to €1.4trn in defined benefit and similar schemes, while defined contribution-type schemes managed €6.2bn. 

Meanwhile 770,000 members have their pension assets housed at a PPI. The number of active members grew in the first quarter to almost 440,000, an increase of 11% compared to a quarter earlier. In addition, there were 330,000 deferred members, 7% more than three months earlier.