Our history

In connection with the ATP reform in 1960, the First, Second and Third Fund Board of the General Pension Fund was established. The funds were to ensure long-term savings and consisted of a basic pension, the national pension, which was the same for everyone, and an income-based supplementary pension (ATP).

The regulations of the fund boards only allowed investments in fixed income securities. The management of the capital of the three fund boards was coordinated in one organization. The ATP-system was based on the fact that the Swedish people's pension payments were financed through compulsory employer and employee contributions.

The Fourth fund board was formed in 1974 to manage part of Sweden's public pension capital and was also allowed to invest in Swedish listed shares. Subsequently, the Fifth Fund Board was established in 1988, also allowed to invest in listed shares, and the Sixth Fund Board in 1996, with the task to invest in venture capital market.

However, forecasts showed that the ATP-system was not financially stable and there was a risk that the AP Funds would be emptied well into the 2000s. The Pensions Working Group (Pensionsarbetsgruppen) was introduced in 1991, and in 1994 it presented a policy proposal for a reformed old-age pension system, which subsequently entered into force 1 January 1999.

History of the buffer funds

In connection with the reform, the first five fund boards were transformed into four AP funds (First, Second, Third and Fourth). The organization that made up the First-Third Fund Boards became Första AP-fonden. A new management organization was established for the Second Swedish National Pension Fund. The Fifth Fund Board changed its name to the Third Swedish National Pension Fund. The Sixth Fund Board and the newly established Seventh Fund Board were renamed the Sixth and Seventh AP Fund, respectively.

The First-Fourth and Sixth AP Funds became buffer funds in the new income pension system that in the long term would manage pension capital in the long term based on the same investment rules, which provide the opportunity to invest in diversified asset classes. The funds should maximize returns in the long term and at a low risk level. They must operate independently and have their own risk management plans, investment and ownership policies. Collaborations have been established for information exchange over time and to achieve cost-effectiveness.

AP4 50 years - A force to be reckoned with over time

Over time our asset management has made a major contribution to Sweden’s public pension system. When AP4 was established in 1974, its mandate was to invest in Swedish equities. At the time, ownership of equities was not as common as today, neither among institutional investors such as pension funds nor among private persons. The decision to establish an AP Fund to invest in Swedish equities was therefore questioned at the time, but it subsequently proved to be a wise decision. At the same time, AP4 has been a source of equity capital not least for listed Swedish companies and a contributing force in the work on establishing rules for ethics and conduct in the Swedish stock market. A favourable return on the fund capital contributes to a strengthening of the pension system and allows promised pensions to be paid out.

From starting the operations with a capital of SEK 500 million, we have contributed and strengthened the Swedish pension system, and today AP4 manages close to SEK 550 billion. AP4's average return has been 13 percent per year since 1974. Over the years, AP4 has also transferred SEK 66 billion net to the pension system. A significant contribution over 50 years. We have succeeded in this by being significant investors in many companies and taking on a great deal of ownership responsibility.

It all started in 1974 when the government established an AP fund to invest in Swedish shares. It was a decision that was questioned at the time when share ownership was not as widespread as it is today, neither among institutional investors such as pension funds nor among private individuals.

The Swedish parliament’s decision to start the new AP Fund was motivated by facilitating the hedging of the AP Funds' investments and improving the supply of venture capital for Swedish companies. In addition to the good returns, AP4 has been a source of venture capital for Swedish listed companies in particular, and over time has been a contributing force in the work on good rules for ethics and conduct in the Swedish stock market. In this way, AP4 has contributed to Sweden's pensioners and the public pension system over time