Bloomberg News

Denmark’s ATP Pension Fund Snubs Short Bonds for Longer Yields

August 23, 2012

Denmark’s biggest pension fund ATP is shifting more of its investment over to longer-term bonds after short-term yields in Denmark and Germany sank below zero.

“We’ve not invested in the very short maturities,” said Henrik Gade Jepsen, chief investment officer at the Hilleroed, Denmark-based fund. In ATP’s investment portfolio, which holds 311 billion kroner ($52 billion) in assets, “we’ve move further out the yield curve,” and the fund almost only owns government bonds with five- to 10-year maturity now, he said.

Danish two-year yields dropped below zero at the beginning of July, and traded as low as minus 0.09 percent on July 31. Germany has charged investors to hold its two-year since the beginning of last month. ATP only holds government bonds from the two countries, Jepsen said.

The fund only holds assets deemed “safe havens by investors,” Jepsen said. “We’d like to have assets in our portfolio that do well when stocks do badly. So we don’t have any bonds in our portfolio that have performed badly as a result of the euro crisis.”

ATP, which last year renegotiated contracts to avoid having to accept French government bonds as collateral, today said net income in the first six months of the year declined 52 percent after profit from investments dropped.

Net income fell to 3.93 billion kroner from 8.13 billion kroner a year earlier, the fund said today. Investment profit after tax declined to 4.44 billion kroner from 8.41 billion kroner.

To contact the reporter on this story: Peter Levring at

To contact the editors responsible for this story: Tasneem Brogger at; Andrew Rummer at

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