LIMA--Peru's Congress late Wednesday narrowly approved a bill
sent by the finance ministry that will reform the nation's private
pension fund plan.
The bill was approved in an 11-to-10 vote, with one
abstention.
Finance Minister Luis Miguel Castilla announced in May the
government's plans to reform the private pension fund system. Mr.
Castilla said at the time that the government aimed to lower
commissions the funds charge by attracting competition with new
pension funds and increasing coverage among workers.
Among the measures to increase coverage, the legislation
requires independent workers under 40 years old to sign up with a
private pension fund.
The government's reforms have been given mixed reviews by the
private sector, which says that it could affect the revenue of the
pension funds and their ability to manage investments. A
representative from Peru's private sector pension association
wasn't immediately available for comment.
Opposition lawmakers say that there wasn't enough time to debate
the proposals and that the approval was rushed.
The private pension system, which includes four private pension
funds, was established in 1993 and has registered about 5 million
people.
The pension funds include AFP Horizonte SA (HORIZC1.VL), which
is owned mainly by Holding Continental and Spain's Banco Bilbao
Vizcaya Argentaria SA (BBVA, BBVA.MC). AFP Integra SA (INTEGRC1.VL)
is owned by Colombia's Grupo de Inversiones Suramericana SA (GIVSY,
GRUPOSURA.BO). AFP Profuturo's main shareholder is a unit of Bank
of Nova Scotia (BNS, BNS.T), while Prima AFP is controlled by
Peru's Credicorp Ltd. (BAP, BAP.VL).
Write to Ryan Dube at ryan.dube@dowjones.com