The war in Ukraine determines a large part of the global economy that was still recovering from two years of Covid.

As a result of actions taken by central banks, especially the first nine months of the year turned out negative for the financial markets. With heavily fluctuating price movements. Things have calmed down somewhat over the last three months. Capital markets are increasingly confident that inflation has reached its peak.

With inflation rates rising, central banks intervened with unprecedented increases in policy rates. Inflation was rising rapidly, not only in Europe, but also in the US and other parts of the world. The purpose of these rises in interest rates was to slow down the economy with the hope of quelling inflation. After years of falling interest rates, interest rates rose rapidly in 2022.

By the end of 2022, the 20-year euro swap interest rate was back to 2013 levels. A rise in interest rates is generally bad news for share investments, but good news for a pension fund's liabilities. With higher interest rates, pension funds may do it with a lower money buffer. Therefore, in 2022, despite a very challenging investment year, the pension fund's funding ratio increased.

Geopolitical and economic developments made 2022 a turbulent year. Virtually all investment categories ended up in the red. As a result, pension fund SSPF concluded the year with a negative return of -19.0% ( €-6,236 million). Nevertheless, the pension fund outperformed the benchmark by 0.3%.

Results return-seeking Assets (RSA) portfolio
The RSA subportfolio - with investments in various categories - also achieved a negative return of -9.3%. RSA's goal is to achieve returns in a controlled manner, while paying a lot of attention to spreading risks. By investing in a spread of different investment categories, the portfolio performed significantly better than a portfolio carrying equity investments only. This is mainly due to more positive returns on the categories Real Estate (+4.6%), Hedge Funds (+2.3%) and Private Equity (-4.4%). In 2022, RSA significantly outperformed the benchmark, achieving an outperformance of 0.5%.

Matching portfolio results
This portfolio, intended to hedge part of the interest rate and inflation movements, also resulted in a negative return. Due to the unprecedented rise in interest rates, the portfolio lost €-3,377 million.

Results Liquidity & Investment Grade assets portfolio
The Liquidity & Investment Grade assets portfolio aims to achieve a moderate return above the risk-free rate. The portfolio is sensitive to interest rate movements and for this reason 2022 was a difficult year. The portfolio resulted in a negative return of -9.6% but outperformed the benchmark. 

The table below shows the assets and returns of SSPF's^[1] investment portfolio. The table divides the total portfolio into three sub-portfolios and compares the returns achieved with the benchmarks set by the board.

[1] This includes derivatives by investment category. Derivatives are represented as a separate balance sheet item in the annual accounts, which are based on accounting standards persuant to  Title 9 Book 2 of the Dutch Civil Code and International Financial Reporting Standards (IFRS), whereby 'receivables' are not netted. As a result, the asset composition in the table below differs from the presentation in the annual accounts.