SBS proposes diversification in pension funds to improve profitability in Peru.

The recent proposal from the Superintendence of Banking, Insurance, and AFP (SBS) to diversify the investment alternatives for pension funds has sparked extensive debate in the Peruvian financial sector. This project, which aims to maximize risk-adjusted returns, proposes to incorporate shares issued through private placements, provided that these comply with the commitment to be listed on a Stock Exchange.

The inclusion of such instruments in the investment portfolio of Pension Fund Administrators (AFP) has the potential to offer more attractive returns in a context where interest rates in traditional markets tend to be lower. However, the proposal also sets important conditions to ensure the security and sustainability of the investments.

One of the most relevant conditions is that the issuers of these shares must adhere to the principles of Good Corporate Governance defined by the AFP in their investment policy. This will not only promote greater transparency in the management of companies but also generate trust among affiliates, who view their pension funds as a lifeline for their financial future.

Additionally, it is established that the minimum value of the placement must not be less than US$80 million or its equivalent in soles. This threshold aims to ensure that only companies with a solid financial base and growth projections are considered, thereby minimizing the risk of default or issues in asset valuation. The requirement for an independent annual valuation until the shares are listed on the Stock Exchange is also part of this prudential approach.

The three-year deadline for listing on the Stock Exchange is another aspect that deserves attention. This measure seeks to balance investment opportunity with the need for companies to align with the regulations of the regulated market, which could result in greater stability for pension funds. However, it also leaves the door open for some companies to potentially fail to meet this requirement, which could negatively impact the risk assessment of the AFP.

The SBS has set up a portal for the industry and the general public to provide comments and suggestions on this initiative until December 19. This openness to dialogue is a positive step, as it allows the voices of all stakeholders to be heard and contribute to building a more robust regulatory framework aligned with market needs.

Investment experts view this initiative favorably, as it could open the door to new opportunities in sectors that have traditionally been inaccessible to pension funds. However, they emphasize the importance of implementing adequate measures for managing risks associated with this new asset class.

The effective implementation of this project will largely depend on the AFP's ability to adapt to the new requirements and properly manage the diversification of their portfolios. This will require not only a review of internal policies but also the training of professionals responsible for investment management.

As the debate progresses and opinions from various sector actors are gathered, it is clear that the SBS proposal could mark a turning point in how pension funds are managed in the country. With a more diversified and responsible approach, it could offer affiliates greater growth opportunities for their savings while simultaneously contributing to the financial health of Peruvian companies.

In summary, the SBS proposal aligns with a global trend towards diversification of investments in pension funds. However, the key to its success will lie in balancing the pursuit of profitability with risk management, thereby ensuring a stronger and safer future for all affiliates.