According to the business plans of fund managers, initial investments made for Pillar II subscriptions were set to be recovered within eight to 10 years, but this move will increase the timeline by a further 10 years, according to some of the top administrators.
Following the Finance Ministry decision, pension fund managers will either have to increase share capital by asking for money from their major shareholders - mostly multinational companies - or to lower share capital to cover such losses.
Employees under the age of 35 are compelled to subscribe to a Pillar II fund, while the measure is optional for those aged 35 to 45. As of last year, a portion of social contributions to the pension fund is taken from the state administration and placed directly in private funds.
