According to the Superintendency of Pensions (Sipen), the nominal profitability of the pension funds In the Dominican Republic, the growth rate continues to rise during the first half of 2024, reaching 10.5%. This figure exceeds the average of the last 12 years and reflects a significant recovery.
By June 2024, more than half of the Pension Fund Administrators (AFP) reported returns of over 10.3%, while in real terms, considering the favourable economic context in terms of inflation, the adjusted return is 5.1%.
Diversification and growth of assets
He Sipen quarterly newsletter indicates that the composition of the investment portfolio of the pension funds as of June 30, 2024 shows a diversified approach.
71.5% of the portfolio is invested in instruments issued by the Ministry of Finance and the Central Bankwhile 12.2% is in investment funds. Since 2016, a significant redistribution has been observed, with an increase in the participation of investment funds and Multiple Banks.
The date of the Sipen details that the total assets of the pension funds in individual capitalization accounts (CCI) has reached just over 1 billion Dominican pesos, with 161 issues of financial instruments allowed for investment.
The annual growth of assets during 2024 has been 16.1%, reflecting a positive trend in profitability and investments. The returns of the pension funds represent 43.3% of property income.
Investment portfolio composition and risk
The investment portfolio, according to the Sipenclassified by risk levels, shows that 86.2% is made up of low-risk instruments (AAA, AA, and A ratings). 11.1% is in moderate-risk investments (BBB rating) and the remaining 2.7% correspond to investments with a high risk classification (C-1).
Evolution of affiliates and contributors
He Dominican Pension System (SDP) currently has 5,167,884 members and 2,146,387 contributors, with an interannual growth of 4.95% in members and 2.21% in contributors.
The quote density among affiliates is 41.53%, which represents a slight decrease compared to the previous quarter and the same period last year. AFP Popular, AFP Grow and AFP Sowing concentrates 78.82% of the affiliates and 74.88% of the contributors.
Demographics and average accumulation
The distribution of members by sex shows that 54.6% are men and 45.4% are women. In terms of contributors, 52.1% are men and 47.9% are women.
Most of the affiliates (60.00%) are under 45 years of age, with a significant concentration in the age ranges of 25-44 years.
The average accumulation per affiliate It is 273,134 pesos, reflecting an annual variation of 16.75%.
Managed Funds and Pensions
He assets of the funds of individual capitalization represents 79.36% of the total, equivalent to 1.3 billion pesos. The AFP with greater weighting in fund management are:
- AFP Popular with 27.2%
- AFP Growing with a share of 18.6%
- AFP Sowing with 17.1%
- AFP Reservations with 13.7%
Pensions awarded
In terms of pensions, 14,976 have been granted survivors’ pensions and 17,252 disability pensions at the end of June 2024. The beneficiaries of survivor pensions total 32,804, with an average pension of 12,957 pesos, while the beneficiaries of disability pensions are 13,405, with an average pension of 12,699 pesos.
The past data represents a year-over-year increase of 9.6% in pension beneficiaries for survival and 9.4% for disability pensions, adding 2,867 and 1,151 new beneficiaries, respectively.
