Danish pension funds Velliv and Danica are focusing on managing more investments in-house, they tell Danish insurance media InsideForsikring in an article comparing costs at Danish pension funds. 

The article compares annual costs as a percentage of pension savings, defined as ÅOP (annual percentage fee), a key figure used by the trade association Insurance & Pension Denmark (IPD). In 2023, PBU had the lowest costs, with an ÅOP of 0.5%, while Danica had the highest, corresponding to an ÅOP of 1.3%. Velliv and AP Pension had ÅOPs of 1.1%.

Danica Pension’s CCO, Dorte Bilsgaard, tells the media that the pension firm’s internally managed investments have outperformed their benchmarks “over a long period”, which is the reason why the DKK 440bn (EUR 59bn) pension company has decided to increase its share of internally managed investments. 

One year ago, Danica’s CIO, Poul Kobberup, told AMWatch that he had lost patience with external managers who performed well below their benchmarks. Instead, he chose to spend the money on strengthening Danica’s own investment teams.

Velliv tells InsideForsikring that it expects its ÅOP to decline to a level closer to 1% as a result of the DKK 270bn (EUR 36.2bn) pension firm having opted to bring the management of more asset classes inhouse in 2023.