The transfer of the Hungarian private pension fund assets of former fund members to the state could start on Friday at the earliest and the former members could get their accrued real yield by August 31, according to a government decree published on Tuesday.
Under regulations published earlier, the private pension funds must transfer the assets -- based on their valuation on May 31 -- to the Pension Reform and Debt Reduction Fund by June 12. After the transfer, the funds are to calculate the real yields to go to former fund members based on the valuation of assets on May 31 and may request payment of these from the Fund's manager, ÁKK, by July 20. If the fund does not have enough cash, ÁKK may cover the transfer of the real yields with a bridging loan from the Unified Account of the Treasury.
The private pension funds must send detailed data on the portfolio to be transferred to the Government Debt Management Agency (ÁKK), the fund's manager, two days before the actual transfer in the government decree, detailing the rules and deadlines on the fund's management and the transfers. This, and the May 31 evaluation day, sets the earliest transfers to June 3.
The Pension Reform and Debt Reduction Fund will have two days to initiate the transfer of the real yields back to the pension funds after having been notified, and the funds have another eight days from the crediting of their accounts to transfer the sum individually on former members account, the Tuesday decree shows. The transfer to the individual accounts must take place by August 31 the latest.
The decree states that the Fund must revaluate its assets, based on their liquidation value as of May 31, without fixing a deadline for the revaluation.
The decree also lists ÁKK's duties, which include drawing up a proposal for the body governing the Fund to decide on the sale of the assets, as well as executing its decision.
ÁKK may involve third members to carry out its tasks based on a contract with the fund, to be signed by May 31.
ÁKK has already contracted Unicredit to act as the custodian in 29 countries for foreign securities in the Fund's portfolio. The services have been extended to three more countries since, the daily Napi Gazdaság reported based on ÁKK information.
The value of assets to be transferred by June 12 is HUF 2,860bn, according to preliminary financial account data from the National Bank of Hungary. Of this amount, the central bank estimated HUF 210bn in membership fee supplements and real yields will be refunded to the private pension funds, and, ultimately, to former members.
Hungarian members of private pension funds had until the end of January to opt out of a move, along with their assets, back to the state pension pillar. About 97% of members returned to the state pillar, bringing their assets with them.