Afore Allianz Dresdner 9mth profits at US$8.69mn

Mexico's 10th biggest pension fund manager Afore Allianz Dresdner reported profits of 98mn pesos (US$8.69mn today) for the first nine months of the year, up 1.7% from 96.4mn pesos in the year-ago period, according to statistics on regulator 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 Allianz Dresdner grew 15.1% in the first nine months year-on-year to 12.2bn pesos, while profits were up 27.9% at 907mn pesos. Siefore Allianz Dresdner closed September with a 3.1% share of the 392bn pesos in assets under management at the country's 12 Afores. Afore Allianz Dresdner's client base declined 2.4% year-over-year to 1.24 million affiliates. The company had a 3.9% market share of the 30.7 million Mexican workers affiliated with an Afore at the end of the third quarter. About 686,000 or 55.3% of clients were directly affiliated with the company, while the other 553,500 were accounts assigned to Allianz Dresdner 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. As of September 31, 2003, Allianz Dresdner was the second most expensive Afore, with an average commission calculated at 1.17% over a 25-year period assuming a real return of 5%. The average commission for the industry is 0.84%. Mexican financial group Grupo Financiero Bital announced in August that it would buy Afore Allianz Dresdner for an undisclosed sum.