The Social Security System (SSS) had P1.27 trillion in consolidated investments as of end-June, giving the state pension fund greater room to explore opportunities overseas while maintaining its presence in the Philippine capital market.
SSS president and CEO Robert Joseph de Claro said the pension fund is looking at international investments to diversify its portfolio, improve returns and support the long-term sustainability of its funds. Under current rules, the SSS is allowed to invest up to 7.5 percent of its Investment Reserve Fund in foreign investments
At the same time, he said the SSS would continue investing locally as part of its contribution to nation-building.
‘We are very conservative, but at the same time, we are also in a very good position now because of our surplus, that for the first time, we have an opportunity to help in nation-building,’ de Claro said.
As of June 30, nearly half, or P629.05 billion, of the state pension fund’s P1.27-trillion investment portfolio was placed in government securities.
The pension fund also had P179.44 billion invested in equities, P154.56 billion in property, P151.90 billion in member loans and P96.34 billion in corporate notes and bonds, among other asset classes.
Government securities made up 49.5 percent of the total portfolio, followed by equities at 14.1 percent, property at 12.2 percent and member loans at 12 percent.
The portfolio generated P27.16 billion in actual investment income in the first half, equivalent to an annualized return on investment of 4.53 percent. The SSS said the figure excludes realized gains from the sale of equity securities classified as fair value through other comprehensive income.
The planned move into foreign markets would mark an additional avenue for the pension fund to spread investment risks across markets and asset classes. However, the SSS stressed that overseas investments would complement rather than replace its domestic holdings.
The pension fund remains a major institutional investor in the local capital market through equities, government securities and other financial instruments allowed under its investment policies.
Expanding internationally could also provide the SSS with access to a wider pool of assets as it seeks to strengthen returns while managing concentration risks in its portfolio.
The fund is targeting to increase its reserve fund to P2 trillion by 2030, or about P730 billion more than its P1.27 trillion in consolidated investments as of June.
The SSS posted a net income of P142.97 billion last year, up by 58.4 percent from 2024. Its total assets grew to P1.26 trillion, up by 22.1 percent from P1.03 trillion in 2024.
In the first half, however, net income fell by 28 percent to P48 billion as benefit payouts increased. De Claro said higher benefit payouts would likely affect the pension fund’s full-year income, which he expects to come in below last year’s level.
De Claro said the SSS remains focused on maintaining a level of income that would ensure the long-term sustainability of the pension fund while allowing it to provide better benefits to members and pensioners.
‘We have other programs to ensure that we maintain a certain level. You always have to balance it. I think making P100 billion a year is already something sufficient that ensures sustainability of the fund,’ de Claro said.
He also said the priority is to increase benefits for members rather than boost the fund’s income.
‘I would pump it (income) to where it matters, which are the members, pensioners, survivor pensioners,’ he said.
The SSS earlier began the early rollout of the second tranche of its three-year pension hike program to help pensioners cope with inflationary pressures and higher energy costs.
De Claro expects the pension fund to release more than P250 billion in benefits this year.