Portuguese pension and insurance funds with €105.8 million Credit Suisse exposure
Portuguese insurance companies’ exposure to Credit Suisse totalled €60.7 million or 0.1% of the sector’s total assets.
This is according to the Insurance and Pension Funds Supervisory Authority (Autoridade de Supervisão de Seguros e Fundos de Pensões) (ASF). Portugal’s total pension funds exposure totalled €45.1 million. (0.2% of the sector’s total assets)
Regarding the type of securities held, according to information on portfolios from regular reporting, the ASF states that the majority corresponds to debt classified as ‘plain vanilla’ (options, bonds, futures, and swaps) rather than subordinated bonds (a bond that will be paid back after other bonds if the issuing bank gets into financial difficulty), with exposure to stock being immaterial.
Debt termed ‘plain vanilla’ allows for interest rates to be exchanged from fixed to variable, whereas subordinated bonds are securities that are less well placed to be restituted in case of a default by the issuers.
At the end of 2022, insurers’ investment portfolios in Portugal totalled €50.2Bn, of which €12.3Bn in respect of bonds issued by private entities as is the case with Credit Suisse.
In the case of pension funds, investments at the end of 2021 stood at €21.3Bn, of which €17.7Bn were managed by pension fund management companies and €5.4Bn by insurers.