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The Warsaw Voice » Business » March 19, 2018
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PPK pension plans profitable in 5 years?
March 19, 2018   
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Poland's investment fund managers should stop losing money on managed by them newly crafted employer-sponsored pension plans PPK as late as in the fifth year of the program's functioning, CEO of PKO TFI investment fund Piotr Zochowski told a conference of PKO TFI's.
"Our estimates show that managing PPK products will break even in the fifth year of program's functioning." Zochowski said during Analizy Online Fund Forum last week.
The estimates are based on a management fee of 0.4% of assents under management (AuM), contribution of 4.0% of the national average salary, and continued TFI membership of a PPK participant, Zochowski said. The calculations exclude distribution and human resources costs.
"Taking them into account, moves reaching the breaking even point even further in time," he observed.
The PLN 1.0 monthly fee per participant to Polish Development Fund PFR, intended to cover the cost of managing a system register, is seen as "the most painful, especially at the beginning, when no assets have yet been accumulated," he underlined.
Poland's government expects that in the first 3-5 years fund managers "won't record profit on managing these plans," according to the finance ministry's explanation of the PPK bill.
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