Investment potential of non-state pension funds in Ukraine

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World practice shows that non-state pension funds (NPFs) are not only a tool for supplementary pensions, but also a source of significant investment in the economy. This study aims at determining the investment potential of 65 Ukrainian NPFs currently functioning in the country. The analysis of Ukrainian NPFs has shown their insignificant role as an investment resource (the volume of their assets is 0.09% of GDP). At the same time, NPFs operate with significant funds (UAH 3.1 billion in 2019), but the lack of a developed stock market and effective financial instruments in the country narrows the opportunities for their investment activities. A study of the structure of NPF assets allocation showed that it is far from optimal in terms of investment portfolio diversification and is very conservative – almost 85% of invested NPF assets are government guaranteed securities and funds in bank deposit accounts. But in the context of tightening the requirements for disclosure of information on the activities of NPFs, promoting the stock market development, formation of reliable mechanisms to protect depositors’ pension savings,and formation of an effective investment portfolio, NPFs in Ukraine

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    • Figure 1. Dynamics of the total value of pension assets, the volume of pension contributions, pension payments, and return on investment of pension assets of NPFs
    • Figure 2. Structures of investment portfolios of private pension funds in some countries of the world in 2018, %
    • Figure 3. The ratio of the assets of accumulative and private pension funds and GDP in selected OECD countries in 2018, %
    • Conceptualization
      Valentyna Tropina, Viktor Melnyk
    • Project administration
      Valentyna Tropina
    • Supervision
      Valentyna Tropina
    • Writing – original draft
      Valentyna Tropina, Mariia Rippa
    • Writing – review & editing
      Valentyna Tropina, Tetiana Rybakova
    • Investigation
      Viktor Melnyk, Natalia Yevtushenko
    • Methodology
      Viktor Melnyk
    • Validation
      Viktor Melnyk, Tetiana Rybakova
    • Data curation
      Mariia Rippa, Natalia Yevtushenko
    • Formal Analysis
      Mariia Rippa, Natalia Yevtushenko, Tetiana Rybakova
    • Visualization
      Mariia Rippa, Natalia Yevtushenko, Tetiana Rybakova