Just 20% of Global Pensions readers are facing their worst ever scheme deficits, our survey shows.
The results follow research published by Mercer earlier this month which warned that defined benefit (DB) liabilities across the world are likely to have increased to record levels in 2010 (click here for full story).
Mercer said although equity returns over the past 12 months have generally been positive, sponsors of large DB schemes preparing their financial statements under current market conditions would still report larger pension scheme deficits than those 12 months ago.
The consultant said this has been caused by falls in corporate bond yields, which affect the value placed on pension scheme liabilities for accounting purposes. In some markets, bond yields have fallen by over a quarter. In the US, since the end of June 2008 AA corporate bond yields had fallen from 6.97% to just under 5% at the end of August 2010.
One respondent said: “We still reflect a fully-funded position”, while another replied: “Positive investment returns have provided a lift from the lows.”
One respondent revealed a funding level of 82.5% and another of 97%.
Here are key takeaways from our 2019 Asset Allocation Outlook on how we are positioning asset allocation portfolios in light of our outlook for the global economy and markets.
This week's top stories included a Freedom of Information request revealing more than 100,000 savers could face six-figure tax bills as a result of GMP equalisation.
The Pearson Pension Plan has entered into a £500m pensioner buy-in with Legal & General (L&G) in the insurer's first deal of 2019.