A government decree that introduces limits on the percentage of foreign assets in private pension fund portfolios is unfavorable for investors, OTP Private Pension Fund told MTI on Monday.
OTP Bank Private Pension Fund head Csaba Nagy called the decree, introduced early August, a step backwards as the new limits do not allow an optimal balance between risk and yields that the government sought to achieve when it required private pensions funds to allow their members to pick between three risk-based portfolios from the start of 2009.
Under the new decree, which aimed to reduce Hungarians' exposure to foreign exchange risk, a 45% limit on the proportion of foreign assets in high-risk portfolios will be introduced from December 31, 2009, and a 35% limit from September 30, 2010. The limit will be set at 20% for the mid-range risk portfolio and at 5% for the low-risk portfolio, both from December 31, 2009. (MTI-ECONEWS)