Non-state pension funds (NPF) will be able to transfer the portfolio to repay part of previously purchased bonds. The result paper will not be exposed to market risk, but to implement them ahead of schedule would be impossible. International financial reporting standards allow you to do this “in rare circumstances” under which subject and pandemic COVID-19, indicate the auditors. However, such a portfolio is likely to be long and illiquid debt securities, experts say.The controller confirmed the possibility of NPF in terms of volatility of financial markets on the backdrop of the spread of COVID-19 reclassification of bonds from the trading portfolio in the portfolio until maturity. This is evidenced by the letter of the Central Bank in Association NPF (ANPP, the document read “b”) in response to the request (see “Kommersant” on April 17).At the end of March, the Bank of Russia announced support for financial institutions after the fall in prices for Russian assets. In particular, they have the opportunity to fix the value of the bonds purchased before March 1 are measured at fair value through profit or loss at its cost at the reporting date. The commit is valid until the end of the year (see “Kommersant” on March 23).The value of the bonds in the portfolio to maturity does not depend on market quotes, that is not exposed to market risks, it will gradually change to the par value at maturity. In the case of increasing credit risk, including a significant reduction in rating or a default occurs, it will be necessary to create reserves for impairment. According to international standards, transfer of securities of the trading portfolio in the portfolio to maturity is permitted only “in rare circumstances”, such as “unlikely to recur in the future,” explains partner of KPMG Andrey Kuznetsov. In his words, “the overall situation with the pandemic COVID-19 falls under the definition of rare cases”. The Central Bank also noted that “currently the issue of recognition of the Declaration of a global pandemic COVID-19 “rare circumstance”… the agenda of the international community.”Date on which can be carried out reclassification of assets may be the day of announcement by the world health organization situation COVID-19 pandemic (see “Kommersant” on March 11), said Mr. Kuznetsov. While it is possible reclassification of “financial assets at fair value through profit or loss only if they are for trade,” he says. Top managers of three major NPF noted that the great majority of such debt securities in their portfolio intended for trading. However, at the end of the crisis to return to its former portfolio of these debt securities, what the NPF asked the Central Bank (see “Kommersant” on March 19), no penalty will fail, the decreeyvaet auditor. If the organization sell a significant portion of the portfolio, recalls Mr Kuznetsov, it “would cast doubt on its ability and intent to hold the portfolio until maturity and the organization will not be able to form such a portfolio a few years.”In fact the NPF, there are three ways to adjust the value of the existing investment portfolio: to transfer the bonds in the portfolio to maturity, to fix their value until the end of the year or not to change anything. According to the head of the investment Department of the NPF “Safmar” Andrey Esin, each option has its pros and cons. The formation of the portfolio to maturity will be deprived of the funds additional yield on the bonds on the background of reduction of the key rate of the Central Bank. If you use relief controller does not clear the possible consequences of such actions. While maintaining the portfolio unchanged NPF face the risk of negative revaluation in case of deteriorating market conditions, he said. “Therefore, most likely, the funds will use some combination of these options: now begin to create a portfolio to maturity of the long and illiquid securities, and by September based on the market situation, decide whether to use and what tools easing of the Central Bank”,— said Mr. Esin.Ilya Osow 2008 and 2014, the Bank of Russia with the support of banks allowed them to be reclassified portfolio to maturity debt securities from other portfolios. Such measures help the financial organizations to provide impossible. “Currently, the accounting regulation for credit institutions and for the NPF based on the requirements of IFRS”,— stated the representative of the Central Bank. Thus, according to him, all indicators, including profitability and the remuneration of the funds, to take advantage of the support measures of the Central Bank in the form of fixing the value of assets will be determined at a single fair value of securities in the accounting (profitability) and the calculation of the net asset value (reward). The volume of debt securities in pension savings at the beginning of the year amounted to 2.3 trillion rubles, pension reserves of 0.9 trillion rubles. While almost 82% of the bonds in the portfolio of pension savings and 89.2% of the bonds in the portfolio of reserves was reflected in the price above par, of 17.5% and 10.4% — at a price below par and the rest at face value. Ilya Usov
