By Nathan Gill and James Attwood

     Nov. 14 (Bloomberg) — Argentina will defend the value of domestic stocks currently held by private pension funds once the retirement system is nationalized, according to the head of the country’s social security agency.

     “The first thing is to maintain their value because it is Argentine capital and Argentine jobs,” Amado Boudou told reporters at a conference in Santiago today. “We will preserve their value, care for them and work in the capital market to make sure they don’t evaporate.”

     The country’s 10 private pension funds, known as AFJPs, held 6.8 billion pesos ($2 billion) in local stocks as of Oct. 31, according to data posted on the regulator’s Web site.

     Argentina’s Lower House voted to support President Cristina Fernandez de Kirchner’s plan to nationalize private pensions on Nov. 7. A full senate vote on the measure may take place Nov. 20, the senate’s Work and Social Security Committee said.

     Argentina’s Merval index fell 1.3 percent to 1,003.01 at 11:36 a.m. New York time, erasing an earlier gain. It tumbled 27 percent in the week ended Oct. 24 when the nationalization plan was announced.

     “The market doesn’t believe what this government says,” said Guido Bizzozero, an analyst at Allaria Ledesma y Cia. “They’ll believe in them based on what they do, not what they say.”