SWITZERLAND - The 30 largest listed Swiss companies have increased their pension scheme funding levels up to 88%, but are still far short of the fully-funded status they enjoyed before the financial crisis, research from Towers Watson shows.
The study found the funding level improved from 85% to 88% in 2009, with 13 out of 30 companies in the Swiss Leader Index (SLI) being at least 90% funded by the end of the year. The funds had combined asset of CHF141.2bn ($152bn) at the end of 2009 with obligations of CHF 160.4bn.
Towers Watson said the rise was partly due to improved investments performance and higher than necessary contributions by sponsoring employers. SLI paid in CHF5.4bn to their pension funds in 2009 - far more than their actuarially required pension costs (CHF3.8bn).
It also expected another improvement in the 2010 findings despite rising discount rates pushing liabilities upward, but said a return to 100% funding was unlikely to be achieved.
Peter Zanella, head of Towers Watson Switzerland, said: "Discount rates have fallen by 0.3% to 0.5%, which led to an increase in liabilities by 5%. But, on the other hand, returns from plan assets have improved."
Towers Watson also said that, compared with 431 Fortune 1000 companies, the SLI companies had improved their funding situation at a faster rate following the crisis.
In 2007, large foreign companies had an average funding level of 106% compared with the Swiss at 99% , but by the end of 2009, the Swiss had overtaken international companies by six percentage points.
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