Russian Pension Funds Post Record Returns in 2025, but Questions Remain Over Payouts to Future Retirees

Russia's non-state pension funds (NPFs) generated record-high returns in 2025, with average yields significantly outpacing official inflation, according to data released by the Bank of Russia. However, analysts and experts question how much of these gains will ultimately reach future retirees, given management fees and opaque fund structures.

Data from the Central Bank shows that the weighted average yield on pension accumulations in NPFs reached 14% annually in 2025, while pension reserve funds yielded 16.2% per year. Since the beginning of 2017, NPF returns have accumulated to 86.5%, barely exceeding cumulative official inflation of 74.1% over the same period. The strong performance was driven by a surge in the bond market—where most pension assets are placed—as the key interest rate declined, along with a substantial influx of participants into the Long-Term Savings Programme (PDS).

Fund-level results varied widely, according to data cited by RBC. Top performers included Khanty-Mansiysky NPF at 22.7%, T-Pensiya (T-Bank) at 21.14%, and NPF Korabel at 21%. Others, such as VTB Pension Fund (20.95%), NPF Rostekh (20.3%), NPF Socium (20.1%), and Blagosostoyanie (20%), also posted strong numbers. At the lower end, SberNPF returned only 15%—a figure that some analysts called disappointing, noting that even money market funds yielded approximately 20% last year. Independent data from Investfunds put Sber's net return after management fees, depository costs, and fund expenses at just 9.74%.

The record earnings come amid ongoing public skepticism about the pension system. Critics point to past scandals where pension savings, including co-financing amounts from the state, were reportedly moved to Cyprus accounts with the knowledge of the Central Bank. Many contributors remain wary, and some investors, like the author of an analysis published on Smart-Lab, have chosen not to transfer their mandatory pension savings to NPFs, preferring instead to participate in the PDS solely for the state co-financing component. The question of how much of the 2025 windfall will actually benefit future pensioners remains open, with high management fees and lack of transparency cited as key concerns.