LatinFinance - May/June 2015 - 45

PAMELA AUSZENKER
BCI INVESTMENT BANK

"HAVING INVESTED IN
US, EUROPE, AND
OTHER MARKETS PAID
OUT. LAST YEAR WAS
VERY GOOD IN THE
US AND SO FAR 2015
HAS BEEN GOOD FOR
EUROPE"
proposals on how to improve it.
While waiting for the Commission recommendations, which are due in August,
congressional debate has stalled as other issues have taken priority. Still, new reforms
could potentially benefit AFPs if Chile's age
of retirement is raised, if all independent
workers are called to contribute, or even if
workers are required to make larger contributions.
Another debate surrounds the AFP fee
structure. The administrators charge fixed
fees no matter how good or bad their performance, a practice that has been criticized in periods of losses such as the crisis

Local stocks lose favor
of 2008 and 2009. On
the other hand, these
Aggregate allocations of Chilean pension funds (% of total assets)
fees remain below the 100
OECD benchmark.
90
Fuentes, of the AAFP,
80
says he hopes for
70
solutions to real prob60
lems, "not reforms
to satisfy ideological
50
arguments, which
40
could hurt future
30
generations of Chilean
20
workers and retirees".
10
Independent from
0
the Bravo Commis2011
2012
2013
2014
2015
sion, the Chilean
International debt
Local fixed income
pensions supervisor is
International equity
Local equity
keeping an eye on the
difficult global investSource: Superintendencia de pensiones
ment landscape.
Profitability from traditional investments
as specialized mutual funds or investment
have declined. "This implies that, in order
funds exposed to those actives.
to improve pensions in the future, we need
The question is whether answers can be
to seek other choices to boost profitability
found and solutions implemented before
while keeping an adequate risk-return corthis Cinderella story takes a darker turn.
relation," says Montecinos.
While profits have been gradually decreasAlternative instruments are among the
ing through the years, Chileans are living
choices that the pensions supervisor and the
longer, copper is not returning to the govsystem's stakeholders are analyzing. Asset
ernment as much as it used to, and volatility
managers can already reach these opporon the global economic stage seems relenttunities through secondary vehicles, such
less. LF

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ISSUE
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LatinFinance - May/June 2015

Table of Contents for the Digital Edition of LatinFinance - May/June 2015

Contents
LatinFinance - May/June 2015 - Cover1
LatinFinance - May/June 2015 - Cover2
LatinFinance - May/June 2015 - Contents
LatinFinance - May/June 2015 - 2
LatinFinance - May/June 2015 - 3
LatinFinance - May/June 2015 - 4
LatinFinance - May/June 2015 - 5
LatinFinance - May/June 2015 - 6
LatinFinance - May/June 2015 - 7
LatinFinance - May/June 2015 - 8
LatinFinance - May/June 2015 - 9
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LatinFinance - May/June 2015 - 16
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LatinFinance - May/June 2015 - 19
LatinFinance - May/June 2015 - 20
LatinFinance - May/June 2015 - 21
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LatinFinance - May/June 2015 - 25
LatinFinance - May/June 2015 - 26
LatinFinance - May/June 2015 - 27
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LatinFinance - May/June 2015 - 40
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LatinFinance - May/June 2015 - 43
LatinFinance - May/June 2015 - 44
LatinFinance - May/June 2015 - 45
LatinFinance - May/June 2015 - 46
LatinFinance - May/June 2015 - 47
LatinFinance - May/June 2015 - 48
LatinFinance - May/June 2015 - Cover3
LatinFinance - May/June 2015 - Cover4
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