New rules to calculate NPF remuneration
The Bank of Russia has prepared requirements for the procedure for calculating the amount of remuneration payable to non-governmental pension funds (NPFs) ‘for success’. The draft ordinance has been released for public discussion.
The remuneration system for NPFs that operate under non-governmental pension provision agreements and participate in the long-term savings programme has changed since 1 January 2024. As from now, the remuneration amount will depend, among other things, on the level of the fund's profitability in the reporting year as compared to a special financial indicator (benchmark) that will be determined by the Bank of Russia.
As a benchmark, the regulator has chosen the average rate on bank deposits for one to three years opened in December of the year preceding the year of accrual of remuneration for NPFs. The Bank of Russia assumes that the indicator is known to NPFs beforehand, reflects real yields in the financial market as of the beginning of each calendar year, and has similar maturities as bonds in NPFs' portfolios.
The new requirements will be applied to calculate NPFs' remuneration already for 2024.