Probe into US bank losses prompts Swedish pension fund chair to quit

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The chair of Alecta has become the latest senior executive to leave Sweden’s biggest pension fund as regulators expand their probe into a series of botched investments.

Ingrid Bonde said on Monday that she would resign as chair of Alecta with immediate effect, six months after she fired Magnus Billing as chief executive after the Swedish fund ended up as one of the biggest losers from the collapse of several US banks, including Silicon Valley Bank.

Sweden’s financial regulator is investigating Alecta over those investments. Since last month, the Financial Supervisory Authority has also been examining the fund’s decision to take a large stake in struggling Swedish property group Heimstaden Bostad. Alecta manages $110bn in assets for 2.8mn savers.

“In a situation where there has been too much focus on my person, I have decided to resign,” said Bonde.

Bonde is one of the leading financial figures in Sweden, where her long career has included stints at the top of the main regulator, the debt office and three of its biggest companies.

But Alecta’s strategy of making large concentrated bets has come under increasing scrutiny in Sweden.

Alecta was the fourth-largest shareholder in Silicon Valley Bank, the fifth-biggest in First Republic Bank and the sixth-biggest in Signature Bank. The investments left the fund with $2bn in losses.

Sweden’s FSA is looking into Alecta’s risk management and whether the fund complied with rules when it made a SKr50bn ($4.6bn) investment in Heimstaden.

Alecta has said it will co-operate with the investigation by regulators.

The fund is one of Heimstaden’s biggest investors with a 38 per cent stake. Like much of the Swedish property sector, the group has been hit by a rapid series of interest rate rises.

Peder Hasslev, the former head of state venture capital group Saminvest who took over as Alecta’s chief executive last month, told Swedish daily Dagens Industri that the pension fund should never have invested in Heimstaden.

Jan-Olof Jacke, deputy chair and chief executive of the Confederation of Swedish Enterprise, will succeed Bonde until a new chair is elected. He has sat on the board since 2019.

“Alecta’s focus or direction does not change because Ingrid Bonde chooses to resign,” said Jacke and the other deputy board chair, Martin Linder.

Alecta is examining its model of concentrating on a few large investments, which had worked well before turmoil swept the banking sector in the first quarter of the year.

The fund had boasted to the local media just before the crisis about how it had sold out of Sweden’s most conservative bank and instead invested in the niche US lenders.