Afore Actinver books US$447k profits

Mexico's newest pension fund manager Afore Actinver reported net profits of about 5mn pesos (US$447k) for the period from when it started operations in April this year to the end of September, according to statistics on Consar's website. Mexico adopted a private pension system in 1997 to replace the state-funded system managed by social security agency IMSS. Under the model, salaried workers contribute 6.5% of their gross wage to pension fund managers, or Afores, which then invest that money through special investment vehicles called Siefores. Assets under management at Siefore Actinver totaled 5.02bn pesos and profits for the first six months of operations were 291mn pesos. Siefore Actinver closed September with 1.3% of the 392bn pesos in assets under management at the country's 12 Afores. Afore Actinver reported 230,100 clients at the end of September, equivalent to a 0.7% share of the 30.7 million Mexican workers affiliated with an Afore. Only 1,160 or 0.5% of clients were directly affiliated with the company, while the vast majority were accounts assigned to Actinver by the regulator. These accounts frequently belong to individuals without a permanent address or who make sporadic contributions because of an unstable employment history, which Consar assigns to the Afores with the lowest commission structures. Afore Actinver is the second least expensive pension fund, with an average commission calculated at 0.62% over a 25-year period assuming a real return of 5%. The industry average is 0.84%. Afore Actinver's affiliation strategy is based on signing up the 35,000 high-income clients of parent company and investment fund manager Actinver.