Participants in non-state pension funds often notice that the amount in their accounts may change over short periods of time — sometimes increasing and sometimes decreasing. This naturally raises the question: does this mean that funds have been lost?
The short answer is no. Such changes are not related to investment performance, but rather to the way the fund’s assets are valued.
To understand this correctly, it is important to look at how a non-state pension fund operates, how the value of its assets is determined, and why it may change periodically.
What is the OTP Pension NPF?
OTP Pension NPF is an open non-state pension fund that enables individuals to build additional pension savings through an investment mechanism. The fund is not a bank deposit and does not guarantee a fixed return. Its performance is determined by the market value of its investment portfolio.
OTP Pension is the largest open non-state pension fund in Ukraine. As of 31 March 2026, its total net asset value (NAV) amounted to UAH 871.4 million, and the fund had 66,662 participants.
The fund has been operating since 2009 without a change of asset management company and is part of OTP Group — a European banking group that applies risk management and control standards characteristic of EU financial markets.
The risk management system has a multi-level structure, ranging from investment professionals to the bank’s and group’s risk committees.
The key mechanism: how the value of assets is determined
The balance in a pension account is not a fixed amount but represents a share in the fund’s total assets. The fund calculates its net asset value (NAV) daily based on the market value of all instruments in its portfolio. Therefore, changes in the value of the fund’s assets are directly reflected in the value of pension savings at a given point in time.
Why do fluctuations occur?
Fluctuations occur because the fund’s assets are valued at market (fair) value in accordance with the requirements of the National Securities and Stock Market Commission of Ukraine and International Financial Reporting Standards.
The key mechanism behind the revaluation of domestic government bonds
A significant portion of the portfolio consists of domestic government bonds (DGBs).
Their valuation is based on:
- market prices (exchange-traded purchase and sale transactions), where available; or
- calculated prices published by the National Bank of Ukraine.
However, when purchase or sale transactions involving securities held in the fund’s portfolio take place on the market, the fund is required to adjust the value of the DGBs to the exchange-traded market level.
It is this revaluation that causes periodic fluctuations in the value of the fund’s assets.
The market value of DGBs depends on their yield:
- if the yield decreases → the price increases;
- if the yield increases → the price decreases.
The longer the time to maturity, the more significantly the price may change.
Does this mean that funds have been lost?
No. Different methods of valuing and accounting for DGBs do not mean that a participant’s funds have been lost.
If a bond is held to maturity, it generates a return in accordance with its issue terms, regardless of interim changes in its market price.
In other words, the short-term valuation of an asset may change, but its underlying economic substance does not.
Summary
Fluctuations in participants’ NPF account balances result from the valuation of NPF assets, primarily DGBs, based on exchange-traded and regulatory prices. Investment performance is generated over the long term, rather than on individual days or months.
Return expectations and market context
The fund’s portfolio is currently operating at an indicative annual return level of approximately 14.5–15.5%, while the results for the first quarter of 2026 amounted to approximately 3.4%.
Under current market conditions, the expected annual return may be around 13%, while the projected inflation rate for 2026 is 8–9%.
Over the long term, the investment result in an NPF is determined by the difference between the portfolio’s return and inflationary pressures, rather than by short-term changes in the value of assets.
