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European pension funds have made just 60 commitments into private capital funds in the region this year.

As it stands, that number has almost halved compared to 2022's 113, according to PitchBook data.

Although European pension funds typically have a smaller private markets allocation when compared to their North American counterparts, this still represents the lowest number of commitments for any year since 2013. The next lowest total was 173 in 2019.
   

Private equity funds have accounted for the highest share of commitments, about a third this year, followed by debt and real assets funds.

Pension funds that form a part of the UK’s Local Government Pension Scheme have been some of the most active private markets participants in the region: Between 2013 and 2023, Greater Manchester Pension Fund and Merseyside Pension Fund have been the two biggest allocators.

The pension funds for East Riding, Strathclyde, Clwyd, South Yorkshire and West Yorkshire—all UK regions—were also in the top 10. Keva, a pension fund for public sector workers in Finland, is the most active allocator outside of the UK.

UK policymakers have been trying to encourage certain pension funds to invest more into alternative assets, as a way of boosting growth in the UK economy and opening up funds to target higher returns. Their efforts have been focused on defined contribution pension schemes, which historically have invested far less into alternative assets, like private equity, compared to defined benefit schemes such as those in the Local Government Pension Scheme.

Featured image by Stocknshares/Getty Images
 

This article originally appeared on PitchBook News