Recently, it became known that the Social Fund purchased "Ayu Grand" for 3.2 billion soms, and in the spring, it bought the "Ala-Archa" shopping center for 1.75 billion soms.
Bakhtiyar Aliyev, head of the Social Fund of the Kyrgyz Republic, explained how these assets affect the pension savings of citizens and where else the fund's resources are directed.
— Why did the fund choose the "Ala-Archa" shopping center for its investments? How will this affect pensioners?
— This decision is part of the planned investments. The amount of 1.75 billion soms did not negatively impact the financial stability of the fund, as it constitutes only 3.2 percent of the total volume of savings.
The acquisition of 100 percent of the shares of OJSC "Ala-Archa" aligns with the Social Fund's strategy to diversify its investment portfolio and reduce risks associated with the placement of pension funds.
The main task is to invest part of the accumulated funds in reliable and long-term assets that can provide stable income.
At the time of purchasing shares of OJSC "Ala-Archa" in May of this year, monthly rental income amounted to about 16 million soms. Currently, it has increased to 28 million, and by the end of the year, we plan to bring it up to 30 million.
According to forecasts, by 2025, the yield will be around 11.6–12 percent per year. In 2026, we expect investment income of about 280 million soms, which corresponds to an annual yield of approximately 15 percent.
Preliminary estimates suggest that the payback period for investments will be about six years.
In a similar manner, the fund acquired the property complex "Ayu Grand" (now OJSC "TST Tunguch"), which is a modern multifunctional shopping center in a rapidly developing area of the capital and already has high rental potential.
Details “Ayu Grand” became the property of the Social Fund for 3.2 billion soms. It is now OJSC “TST Tunguch”
Investments in shopping centers are aimed at ensuring stable income necessary for indexing the pension savings of citizens. According to experts, this project has every chance of becoming a high-yield asset and fully recouping in the medium term.
The acquisition of two shopping centers is a balanced and strategically justified step aimed at growth and preservation of the pension savings of insured individuals.
— Many are curious: where do their savings go in the GNPPF? Can you explain what assets the fund uses for investments and which of them provide the highest returns?
— Pension savings represent "long" money that can be invested in the following assets:
- government securities (GS);
- bonds of local issuers;
- shares of public joint-stock companies;
- shares of index funds investing in foreign government securities and bonds;
- mortgage securities;
- deposits in credit organizations;
- precious metals (gold, silver, platinum);
- securities of the National Bank.
The structure of the GNPPF portfolio as of October 22 of this year is as follows:
- government securities — 48 billion 489.7 million soms;
- bonds of issuers — 200 million;
- shares of companies — 4 billion 987.2 million;
- deposits — 6 billion 575 million;
- cash on bank accounts — 226.6 million.
The highest returns are provided by government securities (14.3 percent per annum) and deposits (12.96 percent).
— What are the results of the GNPPF's work in 2025? How will this affect future pensioners? Is there confidence that the fund's income will not be "eaten away" by inflation?[/b>
— In 2024, the income of the GNPPF amounted to 5.5 billion soms, including:
- income from GS — 4.5 billion soms;
- interest on deposits — 939.6 million;
- income from accrued interest on the balances in GNPPF accounts — 19.7 million;
- other income — 3.3 million.
[b]— Will the Social Fund publish understandable reports on investments and income so that everyone can see where their pension money is going?
— Last year, the income from investments for each citizen with funds in the GNPPF was 12 percent. We publish reports monthly on our official website and social media. Every citizen can contact the district office of the Social Fund and obtain complete information about the status of their account and income from stock investments.
[b]— Many want to know in advance what pension they can expect. Are you planning to launch a convenient online calculator for its calculation?[/b>
— The Social Fund is working on digital transformation and automation of all key processes. We plan to complete this work by the end of 2025. The system will be implemented starting January 1, 2026.
It includes the creation of a "personal account," where the following functions will be available:
- preliminary calculation of future pension;
- information on paid insurance contributions;
- forecast of pension payments.
The launch of a more accurate pension calculator, integrated with the individual accounting system, is planned for the new version of the automated information system of the Social Fund or through the "Tündük" portal.
The expected launch date is May of next year.
