Suva achieves investment performance of -2.7 percent

In the 2018 financial year, Suva's overall performance reached -2.7 per cent, which is below the average of +4.8 per cent over the last ten years. While some of the listed equities closed with significant losses and bond investments were also slightly in the red, investments in private equity, direct real estate, loans and also almost all hedge fund strategies achieved positive results. The situation with money market investments continued to be difficult due to negative interest rates in Switzerland, and high hedging costs were incurred on currency hedges due to the interest rate differential with foreign currencies.

Financial coverage ratio of 134 percent

Suva's fixed assets fell from CHF 51.2 billion to CHF 49.7 billion in the 2018 financial year. These funds are earmarked for specific purposes: They cover Suva's statutory financial obligations, in particular the approximately 88,000 pensions. In good investment years, the accident insurer also consistently builds up fluctuation reserves. This means that pensions remain secure even in the event of a slump on the financial markets. The financial coverage ratio fell from 143 percent in the previous year to 134 percent at the end of 2018, taking into account the provisions that were formed due to the pleasing development of investment income in recent years and are used for extraordinary premium reductions.

Comparison with pension funds

Suva's investment strategy is designed for the long term and broad diversification. A good half of the assets are invested in interest and credit investments, 32 percent in shares and private equity, around 13 percent in real estate and real estate funds and the remaining part in other alternative investments. The investment strategy is most comparable with that of pension funds. In a long-term comparison since 1 January 2000, Suva has achieved a cumulative performance of 89.5 percent. For the LOB 25 (2000/2005/2015) index, the figure was 80.3 percent and for the CS pension fund index, 67.0 percent. For 2018, Suva's performance of -2.7 percent is above the LOB 25-2015 index at -3.0 percent and above the CS-PK index at -3.2 percent.
Suva will present detailed information on the 2018 financial year at its annual media conference on 7 June 2019 in Lucerne.