Indonesia’s pension fund industry assets rose 3.86% last year as retirement funds bought high-yielding government bonds, which helped offset a decline in stocks triggered by foreign outflows.
The pension industry ended 2024 with 380.14 trillion rupiah (US$27.42 billion) of assets, up from 366 trillion rupiah in 2023, according to new figures published on the website of the Financial Services Authority of Indonesia. The regulator typically posts the data without providing analysis.
Pension funds’ government debt assets, excluding central bank bonds, rose 7.6% year-on-year to 136.68 trillion rupiah. Their central bank bond assets surged to 16.87 trillion rupiah from 28.80 billion rupiah in 2023.
But their equity assets slid almost 11% to 24.84 trillion rupiah, sharper than the benchmark Jakarta Composite Index’s 2.54% drop.
Pension funds are likely to continue raising exposure to Indonesian government bonds for the high yields, according to a fund manager at an Indonesian asset management firm, who foresees another choppy year for stocks amid US tariff threats on imports.
“We expect the local stock market to continue to be volatile, at least for the first half of this year, as US trade policies will impact local companies directly or indirectly. Hence, foreign outflows are expected to continue this year,” he tells Asia Asset Management, speaking on condition of anonymity.
