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Borrowing funds from AFPs for anti-crisis program to diversify pension fund investments, FSA
Astana, November 25 2008
The funds raised from Pension Fund Administrators (AFP) for the anti-crisis program will promote diversification of pension fund assets and provide for a more stable flow of revenues, the chairman of the Financial Supervision Agency (FSA) Elena Bakhmutova told reporters.
"The joint steps of the government and SamrukKazyna Fund to raise pension assets for investment projects and acquire bonds of Distressed Asset Funds with an investment rating will diversify pension fund investments and stabilize the revenue flow," she said.
"An approach to assessment of equity capital of APF and pension asset managers will be improved to diminish chances of investing in high-risk tools," she said.
"Second, forming an amount of liquid assets to cover part of APF losses and maintain an adequate level of profitability," Bakhmutova said.
Financiers Association head Serik Akhanov suggested that the government drafted a list of specific investment projects that will be financed through state infrastructure bonds offered to APFs.
For instance, 480 billion tenge (about $4 billion) will be invested in the financial sector stability, he said.
The government will invest 360 billion tenge (about $3 billion) in the stabilization of the real estate market. The money will encourage mortgages, help finish the construction of homes in Astana and Almaty and optimize the state housing program.
A total of 120 billion tenge ($1 billion) will support small and medium business through smaller administrative interference and allocation of funds.
Agriculture will receive $1 billion, the premier said.
Another $1 billion will be invested in innovative infrastructural and industrial projects aimed at full-scale economic modernization and diversification, he noted.