Finnish pension insurer, Varma, recorded a slight investment loss in Q1 2026, with a return of -0.1%, as markets were shaken by heightened geopolitical tensions and energy price volatility linked to the war in Iran.
Publishing its Q1 results, its total assets under management stood at €67.9bn at the end of March, down from €68.3bn at the start of the year.
Despite the decline, the pension insurance company said diversification across asset classes and regions helped stabilise performance in a highly uncertain environment.
“Varma’s investments retained their value in an uncertain market environment. The greatest risk now relates to a war with Iran," Varma CEO, Risto Murto, said.
"A prolonged closure of the Strait of Hormuz would also be a serious setback for the Finnish economy."
Returns varied across asset classes. For example, private equity (2.2%) and hedge funds (1.6%) posted gains, as did Finnish equities.
However, overall equity investments fell by -0.2%, fixed income by -1.2%, and real estate by -0.3%.
Varma deputy CEO, Markus Aho, said markets have been largely driven since late February by energy supply concerns, with inflationary pressures increasingly feeding through to interest rates.
“The duration of the crisis will be decisive for the development of the stock market,” he said, noting that so far they have “remained within their usual range”.
Varma’s solvency position remained strong, with a capital adequacy ratio of 134.7% and solvency capital of €17.7bn, both slightly lower than at the start of the year.
