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EBRD invests in Slovene pension sector
€8 million equity investment in Prva pokojninska druzba
The European Bank for Reconstruction and Development (EBRD) is acquiring a 20%
stake in Slovenia’s Prva pokojninska druzba (PPD), a privately-owned manager
of voluntary and mandatory pension schemes in Slovenia and southeastern
Europe. EBRD’s equity investment of up to €8 million will provide further
funds for the establishment and expansion of Prva’s pension fund and asset
management subsidiaries in the markets of southeastern Europe (Serbia, Kosovo,
Montenegro, Albania, Romania and Ukraine) and at a second stage in the
Commonwealth of Independent States. The EBRD will become the third largest
shareholder of PPD, following Dej, with a 32% share, and Poteza Skupina, with
30%.
This is the Bank’s first equity participation in a Slovene-owned pension fund
management company. Established in 2000, Prva is now the leading pension fund
company in Slovenia with over 67,000 policyholders and a market share of more
than 20%. It currently also has established pension fund operations in
Macedonia, with over 70,000 policyholders and a market share of around 53%,
and in Kosovo and Serbia. Despite being a relatively young company, PPD is
starting to emerge as one of the few pension providers in the region with
adequate experience and clear regional focus.
"The existing shareholders of PPD agreed on a capital increase as the most
appropriate way for the company to strengthen its competences for market entry
in other Eastern European countries," Alenka Žnidaršič Kranjc, President of
the PPD Management Board said. Cooperation with the EBRD substantially lowers
the risks of entry in such markets as it helps us find solid local
partnerships and obtain market expertise, resulting in benefits for PPD’s
policyholders, Žnidaršič Kranjc concluded.
The EBRD has always supported pension reforms in its countries of operation,
François Lecavalier, EBRD Director for Slovenia, Slovakia, Hungary and the
Czech Republic, said. The investment in PPD will enable the Bank to support a
capable regional pension manager in the provision of pension insurance and
pension fund management products across the region. This is particularly
important for the development of the financial institutions market in
southeastern Europe where due to limited disposable income, lack of private
pensions saving culture and relatively small size of the markets, the choice
of such products remains currently limited, Lecavalier added.
PPD is seen as well placed to offer a choice for such products and ensure
transfer of expertise in the pension fund management, which will be
complemented by EBRD’s regional and market expertise.
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