A sound PREVI
Benefit plans Plano 1
Accumulated Results
Accumulated results guarantee Plano 1
2007 results amounted to R$18,131 billion, representing this Plan's 5th consecutive surplus. Added to the previous results (after deducting all expenses with the implementation of the measures for the reduction of contributions and improvements in benefits approved in 2007), the total surplus accumulated reached the amount of 52,937 billion. That amount is distributed in the accounts Reserve for Contingencies (R$15,520 billion), and Special Reserve for Plan revision (R$37,417 billion). The succession of positive results is producing great benefits for all. In 2006 there was a reduction in the contributions and in 2007 the total suspension of same, fact that meant a great economy for participants and sponsors. It was then possible to proceed with the revision of several aspects of the Benefit Plan. This produced an increase in the income or retirees and a projection of better benefits for active employees.
More important, however, is the increase in the guarantee and soundness of this plan, with a reduction in the actuarial rate of interests, changes in the Mortality Table and formation of Reserves (Contingency and Special) in percentages capable to compensate eventual negative performances of the economy, in the future. The surplus accumulated represents a coverage equivalent to 85 % of the actuarial needs of this Plan.
Assets
Plano 1 ended 2007 with total assets worth R$137,12 billion (against R$105,2 billion at the end of 2006). As per PREVI's balance sheet R$136,9 billion of that institution are allocated to the Investment Program. This Balance Sheet shows also the creation of funds for the purpose of financing the annual suspension of contributions (Contribution Fund) and the benefits originating from changes in Regulations stemming from the surplus. In general, the Balance Sheet demonstrates the soundness and strength of Plano 1, with a composition of assets, liabilities and consistent results that provide sustentation to it.
Benefit Plan Plano 1 succeeded in obtaining, during 2007, a profitability of 37.27 % in its investment assets, vs. 35.01% in the previous year. The variable income segment represents 65.79 % of investment assets.
To pay for the expenses relative to the administration of this plan, were considered, for financing sources purposes, funds originating from the following programs:
A) Pension Plan Program; 5 % of the normal contributions- R$33,966 thousand (R$36,990 thousand in 2006);
B) Investment; R$76,870 thousand (R$81,385 thousand in 2006)