Chile’s Ministry of Finance published remarks by its Capital Markets Coordinator, Alejandro Puente, from a roundtable on how the recently enacted Pension Reform could affect the Chilean financial system and capital markets. He highlighted three expected effects: deeper capital markets, a shift toward longer-term investing, and greater certainty for the pension system, including by eliminating the risk of further 10% pension withdrawals. Puente estimated that, compared with a no-reform scenario, pension fund assets could be around 10% of GDP higher in about 20 years, partially recovering losses associated with the three prior 10% withdrawals, while noting the reform will phase in gradually over roughly nine years so the market impact will not be immediate. The implementation timeline cited includes the investment regime taking effect in 2027 alongside the start of generational funds implementation, and a rewards-and-penalties framework beginning in 2029 with transitional mechanisms through 2030 to limit adverse effects. He also noted a Financial Stability Council working group has been created to anticipate risks from the generational funds rollout, defended the planned auction of 10% of affiliates as a mechanism to reduce commissions, and backed a proposal to introduce collegial governance for the Superintendence of Pensions.

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