Local May 13, 2014 | 8:28 am

Threats lurk around US$607.9M fund, Pensions chief warns

Santo Domingo.- Pensions superintendent (Sipen) Joaquín Gerónimo on Monday said the pension fund has topped RD$261.4 billion (US$607.9 million), or 10.3 percent of GDP.

The official said the pension fund have had a good return, noting that workers’ benefits would increased even more by investing them in real estate projects.

In a ceremony at Sipen offices to announced quarterly figures, Geronimo acknowledged a lack of regulations to avert evasion of quotas into Social Security, as one of the sector’s persistent weaknesses. "I believe that steps are being taken to correct that situation. Those are pending issues.”

The Sipen director said while it’s fine to celebrate 12 years of the system’s success, they must also deal responsibly with its weaknesses. “That’s one of them and I think that the Council is trying to work it out."

AFP profits

"Experts from the World Bank categorically stated their point of view on this situation and said so with these words: the above-normal benefits of the AFPs and the high commissions charged by the pension fund administrations pose a threat to the sustainability of individual capitalization formulas," Geronimo said.

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