APS gives Minister of Finance introduction on pension fund and investment portfolio

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Philipsburg, Sint Maarten, – Managing director of the Algemeen Pensioenfonds Sint Maarten (APS) Nadya Croes-van Putten welcomed the new Minister of Finance Perry Geerlings to APS headquarters on Friday July 18th for an introduction presentation to the APS fund. The visit included a tour of the office and staff introductions. With a current asset value of approximately 692 million guilders, APS makes local and international investments as a means to secure its funds for current and future pension payments to its 4400+ participants. The Minister was informed of APS’ financial position, investment policy and strategy and received an overview of the project portfolio.

As per June 2018, the total APS pension asset of 692 million guilders consist of 369 million guilders in the local investment portfolio and 248 million guilders in the international portfolio. As per December 31st, 2017, APS has a rate of 6.97% return on investment. The APS minimum criteria for investments is 5.5%. Croes-van Putten stated: our main goal is to achieve a good return on investments with an acceptable amount of risk. Not every “good” project fits the risk appetite of a pension fund. Pension funds are conservative by nature, more so than banks. Pension funds require solid investments that match the reserves required to make future payments to participants.

In her presentation to the Minister, Croes-van Putten indicated one of the challenges of expanding the current coverage ratio of 101.5% (the Central Bank of Curacao and Sint Maarten (CBCS) minimum norm is 100%) to the APS target of 105%, is that the pension system reform is needed to increase the “future-readiness” of the Fund. “Participants live longer, hence more funds are needed for a longer period as age levels increase.” APS has approximately 4400 participants in the fund, of which approximately 930 are now receiving their APS pensions. Another challenge being the 39 million guilders owed by Government, which cannot be invested in order to make a return on investment and grow the pension funds’ assets.

“Our investment policy and strategy is fueled by our aim to take the driver’s seat in the re-development of Sint Maarten. We have to mobilize “bottled up” capital in pension funds, banks and insurance companies in Sint Maarten. With the establishment of the Sint Maarten Investment Bank, we can use the available local and capital to boost the recovery of the country’s economy and the development of the country’s overall infrastructure. By giving direction to local investments, we will get more control over the direction of our economy and our country. However, we must aim for sustainable, value-added, projects in vital sectors of the economy and emphasize quality over quantity to be successful.” – Nadya Croes-van Putten, Managing director of APS

Croes-van Putten informed the Minister; “stakeholders view APS as a trusted partner”. She further elaborated on the improved internal and external communication policies and strategies, as stakeholders indicated the need for more engagement and information regarding the investments made by APS. Current endeavors of APS include the financing commitment with the SMMC in the New Hospital and the rebuild of the Maho Resort complex, as partner in the First International Caribbean Bank loan to the resort. The establishment of the first Sint Maarten Investment Bank aims to be a “game-changer” for APS and Sint Maarten. Ongoing real estate development projects include the Mary’s Fancy Plantation monument renovation and Oryx Hills residences in Cay Hill.

During the introduction, The Minister indicated the importance of the independence of the pension fund, expressed confidence in the integrity and professionalism of the team of APS. The Minister was “very interested” in the progress of the projects, requesting detailed information on the local and international investment portfolios. APS will follow-up with several additional financial reports and project specific presentations in the coming weeks and months. The Minister wishes to build a “strong long lasting” relationship with APS.

By law, APS is accountable to the Minister of Finance of Sint Maarten. APS’ core responsibilities entail the execution of the Landsverordening Algemeen Pensioenfonds Sint Maarten (Lv APS), investment of collected premiums, to manage investment risks and pay out pensions.