SSS makes first overseas investment

MANILA, Philippines — The Social Security System (SSS) has made its first foreign investment after putting $200,000 in US government Treasuries, with newly appointed President and CEO Victor Limlingan planning to raise the pension fund’s offshore allocation to as much as 5 percent of its investment reserve fund (IRF) by 2027.

Limlingan, who spoke to reporters for the first time since his appointment last week, said SSS was testing the waters with safe assets before significantly increasing its foreign exposure.

READ: SSS eyes global market as investments reach P1.27T

“We have invested offshore, but in safe, secure US Treasuries. I think the most stable currency, among the major currencies, is the dollar. It will outperform the yen and the euro,” Limlingan said.

SSS previously planned to initially allocate 1 percent of its IRF to offshore investments.

“Once you invest and there are no hiccups, if the money comes back and everything works, it’s easy to add to that. Once the system is tested, we will increase. One percent this year is doable, then maybe 4 percent next year, for a total of 5 percent,” he said.

SSS has since published a bid for an investment consultant that will provide expertise for the pension fund’s offshore investment program over the next two years. The consultant will help guide SSS as it gradually builds its foreign portfolio, which could eventually reach the 7.5-percent ceiling for offshore investments allowed under its charter.

Aside from US Treasuries, Limlingan said SSS was looking at high-dividend companies, particularly those linked to precious metals, as well as more real estate and infrastructure.

These investment plans come as SSS’ investment portfolio reached P1.3 trillion at the end of the third quarter, with an annualized return on investment of 4.01 percent. The pension fund is targeting an investment portfolio of P1.441 trillion and a 6.11-percent return by year-end.

Government securities accounted for nearly half of the portfolio at P644.9 billion, followed by equities at P179.9 billion, member loans at P174.7 billion and real estate at P154.6 billion. Other investments, including corporate bonds, bank deposits, externally managed funds and mutual funds, totaled nearly P150 billion.

SSS also reported total revenues of P338 billion in the first nine months, consisting mainly of member contributions of P300.2 billion and investment income of P37.9 billion.

Expenditures reached P275.3 billion, including P266.3 billion in benefit payments and P8.96 billion in operating expenses.

This left the pension fund with net revenue of P62.471 billion.

Stop-loss threshold

Limlingan’s entry and SSS’ move to expand offshore investments comes as the Commission on Audit flagged a 245-percent increase in the pension fund’s paper losses to nearly P40 billion in 2025 from P11.6 billion in 2021, citing the “lack of formal stop-loss thresholds necessary to trigger corrective actions and protect the Investment Reserve Fund.”

Asked about implementing a formal stop-loss threshold, Limlingan said he did not favor an automatic sell-off mechanism and instead proposed a flagging system.

READ: SSS defends equity bets as COA flags paper losses

“We have a lot of good investment professionals. They can analyze the situation. If we have a stop-loss, it’s like telling them not to think. Just sell. I don’t want that. We have a lot of excellent people here. I want to tap their minds, I want them to think, I want them to analyze,” he said.

Limlingan said they were still determining the specific decline that would trigger a review by its Investment Oversight Committee. INQ