First investment made with accumulated pension in Georgia
A total of 560 million GEL was made in deposit certificates of “high-rated Georgian commercial banks”. Photo: Nino Alavidze/Agenda.ge.
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The Pension Agency of Georgia has made its first large scale investment.
A total of 560 million GEL (about $200.75m/€180.57m) was made in deposit certificates of “high-rated Georgian commercial banks”.
A bank deposit is the least risky financial instrument. Also, negotiations are underway with several financial institutions”, said acting director of Pension Fund Giorgi Tchitchinadze.
The Pension Fund announced that the money was invested at a high interest rate and its annual interest rate is 14.9 per cent instead of nine per cent. The investment period is five years.
Tchitchinadze said that once the investment period is over the investment of 560 million GEL will be doubled.
The accumulated pension system came into play in Georgia in January 2019. It is mandatory for legally employed people under 40, meaning they will be enrolled automatically. For the self-employed and those above the age of 40, enrolment in the programme is voluntary.
The pension savings system applies to Georgian citizens, foreign citizens living in Georgia with permanent residency in the country and stateless persons who are employed or self-employed and receive an income.
This system applies to employees of both the public as well as private sectors.
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The National Bank of Georgia has become a governing member of the International Organisation of Pensions Supervisors (IOPS) starting December 2019, announced the National Bank of Georgia earlier today.
About 563.5 million GEL ($196.6 mln/€175.3 mln) has been accumulated in the pension fund since January 1, 2019, says the Georgian Pension Agency. 959,548 citizens and 61,165 organisations are registered in the pension saving system.The employed in Georgia transfer money to the country’s pension savings system which was launched on January 1, 2019.
Director of the Pension Agency Levan Surguladze has confirmed that he has submitted his resignation letter a week ago to the Supervisory Board of the Pension Agency.
The Georgian Pension Agency’s Investment Board has elected a new chair – Olivier Russo. His first deputy will be Jean-Frederick Polsen, announced the director of the pension agency, Levan Surguladze.
About 890 million GEL ($288.49m/€244.94m) has been accumulated in the pension fund since August 3, 2020, of which 1.7 per cent was invested in term deposits, 25.2 per cent in interest-bearing accounts, and 73.1 per cent in certificates of deposit, says the Georgian Pension Agency.
The Georgian Pension Agency has approved an investment policy document which determines the long-term investment strategy of pension savings.
Georgia is the cheapest retirement destination in Europe in 2021, followed by its neighbours Russia and Ukraine, says a new study published by a Chicago-based online lender NetCredit. NetCredit calculated that a retirement cost in Georgia totals $215,911 – 'just over one-third of the US price'.