BOGOTA — Managers of Colombia's AFP privatized pension system recently got the green light to invest 20% of their combined $8.1 billion in assets internationally, but for now many are continuing to proceed with caution.
The six firms that make up the privately managed obligatory social security system in Colombia were the beneficiaries of a more liberal investment regime authorized in March by the Superintendencia Bancaria de Colombia. The industry regulator raised the limit on offshore investment in international securities — including mutual funds — to 20% from 10%.
At the same time, the entity dropped its prior ban on offshore mutual funds that are not allocated either 100% to fixed income or 100% to equities; for example, now equity funds with some fixed income exposure can be purchased by the AFPs. (Foreign asset managers can only manage AFP assets through mutual funds.)