Earned 4.7 Times the 2025 Pension Payouts
Outperformed Major Overseas Pension Funds
The National Pension Service (NPS) achieved its highest-ever fund management performance last year, earning 232 trillion won through fund operations. The sharp rise in the domestic stock market was the primary driver behind this record performance.
On February 27, the Fund Management Headquarters of the National Pension Service announced that, in 2025, it had earned 231.6 trillion won, bringing the total fund reserves to 1,458 trillion won. The operating profit of 231.6 trillion won is equivalent to 4.7 times the annual pension payments (approximately 49.7 trillion won) made by the National Pension Service.
Return Rate of 18.82%... Highest Performance Since Fund’s Establishment in 1988
For the purpose of consistent comparison with overseas pension funds, the National Pension Service's returns were also calculated based on time-weighted returns, resulting in a slight difference from the publicly disclosed money-weighted return of 18.8%.
The return rate was 18.82% (money-weighted rate of return, provisional), and the cumulative average annual return since the fund’s inception stands at 8.04%.
Last year’s return (18.82%) marks the highest figure since the establishment of the NPS fund in 1988. This also stands out in comparison with other major overseas pension funds: Japan’s GPIF posted 12.3%, Norway’s GPFG 15.1%, the Netherlands’ ABP -1.6%, and Canada’s CPPIB 7.7%.
Looking at returns by asset class, domestic equities posted an overwhelming performance with a return of 82.44%. The NPS explained, “The remarkable rise was driven by strong performance in technology stocks centered on artificial intelligence (AI) and semiconductors, as well as expectations for government policies related to capital markets, which significantly boosted the overall fund return.”
Overseas equities recorded a return of 19.74%, domestic bonds 0.84%, overseas bonds 3.77%, and alternative investments 8.03%, indicating relatively solid performance across all asset classes. Overseas equities also performed strongly, led by robust results in technology stocks such as AI, despite uncertainties surrounding US tariff policy.
Domestic bonds achieved positive returns, fluctuating throughout the year amid two benchmark interest rate cuts and an overall economic recovery trend. Overseas bonds also posted positive returns, as bond values rose due to three US benchmark rate cuts and declining rates triggered by concerns over economic slowdown.
The return on alternative investments reflected both the appreciation in asset valuations and realized gains.
National Pension Service Chairman Sungjoo Kim stated, “The NPS set a new all-time record last year, delivering one of the highest performances among pension funds worldwide, largely benefiting from the rise in the domestic stock market.” He added, “This achievement is also the result of continuous improvements in infrastructure, including rigorous risk management from a long-term perspective, diversification of asset allocation, and enhancements to the performance-based compensation system.”
He went on to say, “Going forward, as the fund continues to grow, we will further strengthen our management capabilities and do our utmost to enhance long-term stable returns by promoting flexible asset allocation, investment strategies, and diversification by region.”
Meanwhile, the final performance evaluation of the National Pension Service’s fund management will be confirmed by the Fund Management Committee around the end of June after a review by the Risk Management and Performance Compensation Expert Committee.
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