The Alecta pension fund has been selling off its U.S. treasury holdings since the beginning of 2025, and the Swedish institution has now divested between $7.7 billion and $8.8 billion worth of American government bonds. This represents what analysts are calling a major European pension fund divestment, and it comes at a time when concerns about U.S. treasuries risk have been mounting across institutional investors in the Nordic region and beyond.
The move by the Alecta pension fund follows a similar announcement from Denmark’s AkademikerPension just one day earlier, which revealed plans to exit its entire $100 million position in U.S. government bonds. Both pension funds cited concerns about American fiscal policy and growing federal debt levels, signaling what could be described as a broader treasury bond sell-off pattern among European institutional investors right now.
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Alecta Pension 2026 Moves Highlight European Pension Fund Divestment Risks
Swedish fund Points to Policy Unpredictability
Pablo Bernengo serves as the chief investment officer at the Alecta pension fund, and he confirmed the staged divestment approach in statements to both Reuters and Bloomberg this week. The Alecta pension fund didn’t make the decision to reduce its American government bond holdings overnight, according to Bernengo’s comments.
Bernengo stated:
“Since the beginning of 2025, we have reduced our holdings in U.S. government bonds in several rounds, and together the reductions account for the majority of our holdings.”
The reasoning behind the Alecta pension fund’s decision involves multiple factors, including what Bernengo described as reduced predictability in American policymaking. Bernengo also had this to say:
“This is connected to the decreased predictability of US policy in combination with large budget deficits and a growing national debt.”
The Alecta pension 2026 strategy appears to reflect broader institutional concerns about U.S. treasuries risk, particularly as the U.S. federal debt continues to grow and political uncertainty increases. The Swedish fund manages over $110 billion in total assets, making this one of the larger European pension fund divestment moves in recent memory.
Denmark’s Parallel Exit from American bonds
Anders Schelde, who serves as chief investment officer at AkademikerPension, announced his fund would complete its exit from U.S. treasuries by January 31. The Danish pension fund held a position substantially smaller than what the Alecta pension fund held, but the timing and reasoning behind both moves suggest Nordic institutional investors share coordinated concerns.
Schelde told Bloomberg:
“The US is basically not a good credit and long-term the US government finances are not sustainable.”
In additional comments to CBS News, Schelde explained the practical implications of the decision. Schelde stated:
“The decision is rooted in the poor U.S. government finances, which make us think that we need to make an effort to find an alternative way of conducting our liquidity and risk management.”
This European pension fund divestment pattern now includes two major Nordic funds within a 48-hour period, and analysts are watching to see if other institutional investors follow suit. The treasury bond sell-off comes at a particularly sensitive time, with President Trump making aggressive statements about acquiring Greenland from Denmark and threatening 35% tariffs on European nations that don’t support his territorial ambitions.
U.S. Treasury Secretary Dismisses the concerns
Scott Bessent, who serves as U.S. Treasury Secretary, responded to news of the treasury bond sell-off during a press conference at the World Economic Forum in Davos, Switzerland. His comments were notably dismissive of both the Danish move and, by extension, concerns about the Alecta pension fund divestment as well.
Bessent said:
“Denmark’s investment in U.S. Treasury bonds, like Denmark itself, is irrelevant. That is less than $100 million. They’ve been selling Treasurys for years, I’m not concerned at all.”
At the time of writing, Bessent has also rejected broader concerns about European investors pulling back from American assets. During the same Davos event, Bessent stated:
“I think it is a completely false narrative. It defies any logic, and I could not disagree more strongly.”
Unsustainable American Fiscal Policy
The amount that the Alecta pension fund has disposed of, approximately in the range of 7.7-8.8 billion, is a much larger transaction than what AkademikerPension has sold. Europe as a bloc holds about 8 trillion U.S. bonds and equities, which gives it a lot of leverage in case the tensions between America and the European countries continue to mount either on trade policy, tariffs, and other geopolitical aspects like Greenland.
The Alecta pension 2026 shift, along with other Danish pension fund actions, begs the question of whether other European institutional investors will re-examine their stance in the American government bonds. Both Alecta pension fund and AkademikerPension have stressed that their moves were motivated mostly by fiscal issues and not political retaliation although the timing definitely follows the escalation of tensions between the Trump administration and European partners.
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With the issue of U.S. treasury risk persisting in institutional investors minds, and the selling of treasury bonds gaining traction in the financial markets, fund managers in Europe could be contemplating similar European pension fund divestment plans to cushion their funds against what they see as unsustainable American fiscal policy and rising levels of federal debt.