BoE: Pooled funds key cause of LDI market turmoil

Bank says pooled vehicles played major role despite representing only 15% of LDI market

Jonathan Stapleton
clock • 3 min read
Sarah Breeden: The complexities surrounding pooled funds created the severe dysfunction that caused the BoE to intervene
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Sarah Breeden: The complexities surrounding pooled funds created the severe dysfunction that caused the BoE to intervene

The operational and governance complexities of recapitalizing pooled funds were a primary driver of the liability-driven investment (LDI) market crisis last year, the Work and Pensions Committee (WPC) has heard.

In the second session of the fourth formal meeting of the WPC's inquiry into defined benefit pensions with LDI - held this morning (1 February) - the committee heard evidence from Bank of England (...

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