Afore Bancomer profits climb 10.6% to US$77mn

Mexico's second largest pension fund manager Afore Bancomer reported net income for the first nine months of the year of 848mn pesos (US$77mn today), a 10.6% increase compared to profits of 769mn pesos in the same period last year, 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 this model, salaried workers contribute 6.5% of their gross salary to pension fund managers, or Afores, which then invest that money through special investment vehicles called Siefores. Assets under management at the company's Siefore grew 28.3% year-on-year to 83bn pesos, while profits were up 32.5% at 5.87bn pesos. The Siefore finished September with a market share of 21.2% of total assets under management. Afore Bancomer had 4.33 million clients at the end of the third quarter, a 2.4% increase over last year. In terms of clients, Afore Bancomer had a 13.8% market share of the 30.7 million Mexican workers affiliated with the country's 12 Afores. About 3.11 million or 72% of clients were directly affiliated with the company, while the other 1.22 million were accounts that had been assigned by the regulator. These accounts frequently belong to individuals without a current address or who make sporadic contributions because of an unstable employment history, which Consar assigns to the Afores with the lowest commission structures.