Emerging private pension market 50% up

TIRANA, Jan. 25 – The Albania private pension market, although still in its initial underdeveloped stage, registered a significant increase in 2010. Data made available by the Financial Supervisory Authority show voluntary private contributions rose by 53 percent while the number of contributors by 12.7 percent.
Currently, only three companies operate in the private pension market.
Data show Raiffeisen Pensions, Capital and Sigma IPP which have been licensed by the Supervisory Authority had 112 million lek of contributions in January-December 2010, up from 73 million lek at the end of December 2009. All three companies reported around 5,000 private pension contributors during 2010.
The licensed companies manage pension funds in order to provide supplementary private pensions for the individuals during their third age period. In addition, employers may also make contributions on behalf of their employees.
The private voluntary pension market has a small share of the Albanian non-banking financial market and is still below its real potential for further development, said the Financial Authority.
At the end of 2009, the legal framework for private pensions was amended by a new law on voluntary pension plans. The law opens up the possibility for the establishment of defined contributions third pillar pension funds, but does not reflect all the provisions of the acquis, said the European Commission in its 2010 report on Albania.