4.21 trillion yuan pension "official ledger" exposed, who is steering this wealth marathon?

Ask AI · How does a long-term evaluation mechanism guide pension investments toward long-term strategies?

The latest annual “official ledger” for corporate annuities has been released.

Recently, a data summary of business information for national corporate annuity funds published by the Ministry of Human Resources and Social Security shows that, as of the end of last year, there were 177.9k covered enterprises and over 33.42 million covered employees. Inclusive coverage continues to deepen. At the same time, after the size of the accumulated corporate annuity funds surpassed 4 trillion yuan in the third quarter last year, it surged again to 4.21 trillion yuan by the end of last year. The net value of investment assets rose in tandem to 4.17 trillion yuan, with a cumulative return rate of 12.94% over the past three years.

Currently, 22 pension fund investment management institutions are competing on the same stage, with the effect of leading players becoming prominent. Among them, Taikang Asset Management ranks first with a portfolio asset size of nearly 715.4 billion yuan. Industrial and Commercial Bank of China (ICBC) Credit Suisse Asset Management Fund, meanwhile, takes the lead in equity-including portfolios based on its performance strength, with a single plan’s cumulative return rate over the past three years reaching 19.3%.

With the full rollout of the long-term evaluation mechanism, pension funds are accelerating their shift from short-term games to “patient capital and long-term investing.” In the view of industry participants, this provides institutional support for increasing the equity allocation ratio. Pension funds are an important force of medium- to long-term capital. Going forward, as their scale continues to expand, the market will further shift toward “professional head-to-head competition,” better adapting to complex and ever-changing investment environments.

Corporate annuity scale exceeds 4.2 trillion yuan

As the second pillar of the old-age security system, corporate annuities have long played an important role in supplementing retirement income. In recent years, they have maintained steady growth. The latest data show that, as of the end of 2025, the number of enterprises that have established annuities nationwide reached 177.9 thousand, up 11.66% year over year. The number of covered employees rose to 33.4299 million, with a net increase of 177.9k over the year. As a result, the system’s inclusive coverage continues to expand.

Accordingly, the size of accumulated corporate annuity funds surpassed the 4 trillion yuan threshold, reaching 4.21 trillion yuan, up 15.45% from the same period the previous year. The net investment asset value was 4.17 trillion yuan, up 15.63% year over year.

While the market’s overall scale keeps growing and the covered population steadily expands, the annuity payout side also shows distinct characteristics. In 2025, the number of people receiving corporate annuities reached 3.6882 million, with payout amounts of 40k yuan. Among them, phased withdrawals have become the absolute mainstream, with 97.22% of recipients and 94.07% of payout amounts.

Corporate annuity portfolios are divided into single plans and pooled plans. A single plan refers to a corporate annuity fund entrusted by a trustee from a single employer, with the annuity plan managed separately by the trustee. A pooled plan refers to a corporate annuity fund entrusted by multiple employers to the same trustee, with the annuity plan managed centrally by the trustee. Both single plans and pooled plans are further divided into fixed-income portfolios and equity-including portfolios.

“A single-plan model needs to develop a dedicated solution for each company. It is suited to large enterprises or groups, because their capital scale is bigger, which can support the cost of independent operations and also meet individualized investment needs. Compared with that, pooled plans have advantages such as higher efficiency, lower costs, and economies of scale.” A securities analyst said.

In terms of performance, as of the end of 2025, there were 6,118 corporate annuity established portfolios, with a cumulative return rate over the past three years of 12.94%, which was up 0.86 percentage points quarter-on-quarter from the data released in the third quarter of last year. In particular, fixed-income portfolios maintain stable characteristics: the cumulative return rate over the past three years was 10.86%. Within that, the single plan and pooled plan categories were 10.83% and 10.92%, respectively, both with some growth quarter-on-quarter.

In the current low-interest-rate environment, equity-type assets are playing a key role in improving returns. Under single plans, the cumulative return rate of equity-including portfolios over the past three years rose sharply from 12.53% in the third quarter of last year to 13.42%. Under pooled plans, the cumulative return rate of equity-including portfolios over the past three years also rose from 10.76% to 11.99%.

It is worth noting that, unlike the annual data from the previous year, in this report the investment management information only discloses cumulative return rates over the past three years; it does not disclose figures such as investment returns for the year or the weighted average return for the year. The return rate calculation method was also changed to the time-weighted method.

22 institutions compete for the 4-trillion-yuan market

At present, there are 22 corporate annuity fund investment management institutions, including public funds, securities firms, asset management firms, pension insurance institutions, and other types. These 22 institutions manage 5,971 annuity portfolios, with total portfolio assets of 4.15 trillion yuan. Among them, Taikang Asset Management ranks first with a total portfolio asset size of 42.1k yuan.

Overall, investment management institutions are mainly asset management companies (fund companies). 11 fund companies manage 1,970 annuity portfolios, corresponding to total portfolio assets exceeding 1.69 trillion yuan, accounting for more than 40%.

Among them, China Asset Management (E Fund) ranks first with 428 annuity portfolios, managing a scale of 335.4 billion yuan, up 10.62% year over year. Southern Fund follows closely, with a total managed scale of 279 billion yuan across 334 annuity portfolios, up 13.43% year over year.

ICBC Credit Suisse Fund may be third with 316 portfolios, but its managed scale increased by three-tenths year over year, reaching 398.5 billion yuan, making it the fund company with the largest managed scale in the industry. Meanwhile, Cathay Fund has the largest growth in scale—up 59.64% year over year to 142.4 billion yuan—rising in rank from sixth to fourth.

Whites Fund, Huaxia Fund, and others manage 168 and 121 portfolios respectively, with corresponding portfolio asset scales all above 120 billion yuan. The other five fund companies have not yet reached the 100-billion-yuan scale.

Among other corporate annuity fund investment management institutions, six pension insurance institutions jointly manage 2,383 portfolios with an asset scale of 1.32 trillion yuan, accounting for 31.88% of the total portfolio assets. Among them, China Life Pension Insurance Co., Ltd. manages the largest number—910 portfolios—corresponding to an asset scale of 41.7k yuan.

From an investment level perspective, the vast majority of corporate annuity fund investment management institutions achieved positive returns over the past three years. For fixed-income portfolios, whether in single plans or pooled plans, all 22 institutions’ average cumulative return rates over the past three years exceed 10%. Within that, the highest single-plan return rate is 12.62% by Citic Securities; Cathay Fund, with 13.43%, ranks first among pooled plans.

For equity-including portfolios, fund companies perform even more strongly. ICBC Credit Suisse Fund and Cathay Fund take the top two positions in the two major portfolio categories. Specifically, for ICBC Credit Suisse Fund, the cumulative return rates over the past three years for equity-including portfolios are 19.3% for single plans and 18.51% for pooled plans, respectively.

Long-term evaluation leads to a new pattern of “patient capital and long-term investing”

In fact, the “cumulative return rate over the past three years” metric is not appearing for the first time. Yicai Finance reviewed historical data and found that when the Ministry of Human Resources and Social Security released the national corporate annuity fund performance data for the first quarter of 2025, it used this metric for the first time—rather than the current-period or annual return rates used previously.

In the view of industry participants, the regulatory performance evaluation orientation is shifting toward “patient capital and long-term investing,” and the disclosure system for corporate annuity investment performance is transitioning to a medium- to long-term dimension. This is highly consistent with the long-term nature of pension funds, and it is also an important part of the “long-cycle evaluation” reform in the pension sector.

In recent years, a number of policies to promote medium- and long-term capital to enter the market have been rolled out. For example, in January of last year, the “Implementation Plan for Promoting Medium- and Long-Term Funds to Enter the Market” clearly stated that annuity funds and others should comprehensively establish and implement long-cycle evaluations lasting three years or more.

In January of this year, the guidance on improving the long-term evaluation mechanism for annuity funds (hereinafter referred to as the “Guidance”) was issued, setting hard metrics for corporate annuity investment. It clarifies that annuity fund performance evaluations are conducted over the contract term (principally not less than three years) as the evaluation cycle, with medium- to long-term objectives as the main basis. It also adds medium- to long-term indicators and quantitative indicators covering periods of three years or more.

“One current feature is that the industry structure is becoming more concentrated at the top. Going forward, the focus of competition may shift toward differentiated services.” A fixed-income analyst at a securities firm said. By shifting the evaluation mechanism toward long-term horizons, institutions are pushed to focus on medium- to long-term returns, guiding funds to follow the approach of “patient capital and long-term investing.” This provides an institutional foundation for improving the equity allocation ratio. Going forward, as the scale of annuity funds expands, leading institutions may further consolidate their competitive advantages by enhancing their own equity-asset allocation and differentiated capabilities.

“While ensuring stable and prudent operations, gradually increase the proportion of equity investment by long-term funds, including annuity funds.” A research and investment professional from a public fund company said. From the root, the ultimate goal of annuity funds should still focus on pursuing stable absolute returns, and on that basis, appropriately increase the share of equity assets.

In that person’s view, adhering to an investment philosophy of absolute returns and maintaining a focus on risk prevention and business discipline should be the top priority for annuity investments. Under that premise, efforts should be made to carry out more precise and fine-grained performance oversight. Based on different risk preferences of different employer clients, customized investment management plans should be provided that match their needs, with the goal of preserving and increasing the value of annuity fund assets.

However, a person from an annuity management department at a pension insurance firm also cautioned that “under a long-cycle evaluation orientation, the cost of experimentation for investment and management parties increases, so trustees need to evaluate the choice of investment and management parties more cautiously.”

He further said that as the annuity fund evaluation mechanism shifts from the short term to the long term, it places higher requirements on the research and implementation of strategic asset allocation. For example, in terms of talent building, it is recommended to optimize promotion pathways and compensation and incentive mechanisms, establish a scientific and comprehensive set of evaluation indicators to implement the long-cycle evaluation mechanism, and ensure that the actions of investment managers remain consistent with the long-term goal of stable value preservation and appreciation for annuity funds.

(This article comes from Yicai Finance)