Romania's mandatory private pension system, known as Pillar 2, has generated a net gain of 51.4 billion lei (approximately 10.1 billion euros) for Romanians in its first 17 years of effective operation, which marked its anniversary in May 2025, according to data from the Association for Privately Managed Pension Funds in Romania (APAPR).
As of the end of May, the seven Pillar 2 private pension funds managed a total of 166.2 billion lei on behalf of 8.3 million participants, APAPR reported in a press release on Wednesday.
According to the source, over these 17 years, Pillar 2 funds collected gross contributions totaling 118.6 billion lei and made payments of approximately 3.8 billion lei to about 238,000 beneficiaries (including heirs).
The difference between the net assets under management plus payments made and the gross contributions collected represents a net gain of 51.4 billion lei, after all fees, entirely benefiting the contributors to Pillar 2.
The average annual return across all Pillar 2 funds over these 17 years was 7.8%, significantly above the average inflation rate of 4.4% over the same period, APAPR mentions.
"In recent years, Pillar 2 has successfully weathered numerous periods of market volatility (...). After each temporary decline, the private pension funds resumed growth, the most recent example of a rapid recovery occurred in 2025 following the episode of domestic political volatility," said APAPR president Radu Craciun.
Currently, 8.3 million Romanians are enrolled in the mandatory private pension system, the majority of the country's active population. Of these, 4.5 million regularly contribute 4.75% of their gross income, which is part of the 25% social insurance contribution (CAS).
Pillar 2 assets are the second most valuable financial asset held by Romanian citizens, after bank deposits, and represent a key foundation for long-term financial security and prosperity, APAPR representatives point out.
The average personal account value in Pillar 2 pensions has now reached 20,000 lei, a figure that has doubled in the last four and a half years. Meanwhile, a Romanian earning the average salary who has been contributing continuously since Pillar 2 began now has around 47,000 lei in their account.
Around 95% of the Pillar 2 funds are invested in Romania, making private pension funds the most significant domestic institutional investors.
Approximately two-thirds of the assets are invested in government bonds, while almost a quarter are invested in companies listed on the Bucharest Stock Exchange. This way, the funds support sustainable long-term financing of the Romanian state, economic growth and job creation, while maintaining a relatively low-risk profile.
"Currently, all indicators are at historical highs for the pension funds, which strengthens Romanians' trust in this savings system. These have been 17 years in which Pillar 2 has proven to be a successful reform, similar to systems in developed EU and OECD countries, with a strong economic and social role," added APAPR president Radu Craciun.
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