German Pension Funds May Ease Rules After S&P, Ministry Says

Two German pension funds for civil servants in the federal government may ease their investment rules for government bonds after Standard & Poor’s downgraded euro-area countries, the Interior Ministry said.

Officials in the German Finance and Interior Ministries have been discussing the change for several weeks, an Interior Ministry spokesman, who declined to be identified in line with official policy, said in a phone interview today in Berlin. The funds, which have holdings worth about 5 billion euros ($6.4 billion), can only invest in bonds rated AAA by all three major credit-rating companies.

No decision has yet been made, the spokesman said. The plan was reported earlier in Handelsblatt newspaper.

To contact the reporters on this story: Tony Czuczka in Berlin at aczuczka@bloomberg.net; Patrick Donahue in Berlin at pdonahue1@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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