Mikael Nyman is one of Sweden’s foremost experts on pensions and occupational pensions. He doesn’t think it was wrong for Alecta to leave safe Swedish bank stocks a few years ago and instead invest in riskier niche banks in the US – but he believes that the pension giant should have had better control over the past year. Especially since their stated strategy has been to invest money in relatively few companies which they will then be able to follow extra closely.
– I think that you should have seen that there was a high risk in Silicon Valley Bank because you knew that interest rates were on the way up. That analysis should have been done in the chamber at Alecta just over a year ago, he says.
Pension company Alecta’s CEO Magnus Billing himself describes the investments as “a failure” and admits that at least SEK 12 billion went up in smoke after the American banks Silicon Valley Bank and Signature Bank both recently collapsed.
In addition, Alecta has invested another SEK 9 billion in a third American bank, First Republic Bank, whose share price has plummeted.
“Will cost money”
Mikael Nyman explains that those most affected by Alecta’s failed US investments are all those who have their occupational pension (ITP1) via Alecta and were born after 1979, when Alecta stands for the so-called non-election option. Everyone who has not actively chosen another company for their occupational pension thus gets their money invested with Alecta, probably close to a million Swedes.
– Everyone who saves in Alecta is affected, and above all those who are a little younger, i.e. those who were born in 1979 and younger and who are in the so-called ITP1 plan. It will not jeopardize their future pension, but it will cost money, says Mikael Nyman.
See more in the clip above.