CHENGDU, Dec. 7 (NBD) -- China's National Council for Social Security Fund (NCSSF) on Tuesday nominated 21 institutions qualified for managing the basic pension insurance fund, including 14 fund management firms, one securities companies and 6 insurers.

Yang Delong, the chief economist with First Seafront Fund told NBD that this newly released list overlaps largely with the list of investment managers handling social security fund. It indicates the similar investment manner in handling the basic pension insurance fund and the social security fund.

Yang explained the reason behind the predominance of fund management firms in the list. In his opinion, fund management firms are the most professional institutions in investment management. They have obtained good business performance before and created pleasant returns in managing social security fund. Therefore, institutions managing the social security fund become the priority selections for NCSSF which is entrusted by local governments with the basic pension insurance fund.

When asked about the enlisting of 6 insurers in an interview with NBD reporter, Cui Junsheng, the general manager assistant of Union Asset said, advantages of insurers lie in the fixed-income sector, which can enhance the earnings stability of the pension fund. Cui believed the insurers may be selected for the sake of increasing investment diversity.

Anonymous source revealed that China’s pension balance amounts to 3,500 billion yuan (about 508 billion US dollars), approximately 2,000 billion yuan (about 290 billion US dollars) is available for investment.

The basic pension would be entrusted by local governments in several batches, according to NCSSF.

NBD reporter acknowledged that for the first batch, 4 provinces have shown the intention of pension investment with a total amount of 400 billion yuan (about 58 billion US dollars) available.