The mainland's national pension fund raked in 42.7 billion yuan (HK$48.54 billion) from its equity investments last year, piggybacking on an 80 per cent jump on the country's stock market. The National Social Security Fund (NSSF) said its assets grew 38 per cent to 776.5 billion yuan. The handsome gain could help allay concerns about China's under-funded national pension pool, with the central government doubling efforts to replenish the NSSF as the population of the elderly rises. A World Bank report says the pension fund is likely to face a 9 trillion yuan shortfall by 2075 because of a rising number of retirees. The NSSF said it realised a profit of 42.7 billion yuan from equity investments last year and booked a further 42.3 billion yuan in paper gains. 'It has stabilised after a turbulent year in 2008,' said Peter Alexander, a principal at fund industry consultancy Z-Ben Advisors. 'There were solid and respectable returns.' The Shanghai Composite Index climbed 80 per cent last year amid an economic recovery and an influx of speculative capital after it dived 65.4 per cent in 2008, the biggest annual decline in history. The NSSF lost 62.7 billion yuan on equity markets in 2008 while gaining 23.3 billion yuan of interest income. Overall, the fund lost 39.4 billion yuan in 2008, the first time it had dipped into the red. The fund is now allowed to invest a maximum 30 per cent of its assets in mainland-listed A-share firms. It said it received additional assets of 82.6 billion yuan last year as the government strove to boost reserves to cover more retirees. In June last year, Beijing ordered state-owned companies that had listed on the stock market since 2005 to transfer the equivalent of 10 per cent of their share floats to the fund. China set up the NSSF in 2000 to replenish pension pools. Government subsidies, contributions from individual workers and their employers and lottery sales are the three major sources of its funds. The NSSF says it has recorded an annualised 8.98 per cent investment return since 2000. 'Overall, the performance was good, and it proved the NSSF's asset allocation in the past years was reasonable,' said Zhou Liang, the chief of the asset management department of Zheshang Securities. 'Safety of the fund is still the government's top concern, despite the urgency to increase the pension pool.' The NSSF designates selected domestic mutual funds to help invest part of its assets in yuan-denominated A shares. Last month, NSSF chairman Dai Xianglong said the pension fund would be allowed to earmark as much as 20 per cent of its assets for overseas investment, up from the current limit of seven per cent. He said the raised investment cap would let the NSSF plough a further 100 billion yuan of assets into overseas markets.