Median solvency on April 1, 2017 stood at 96.7%, up nearly two percentage points from the beginning of the year. Meanwhile, almost 40% of plans were fully funded at quarter’s end, up four percentage points from Q4 2016.
Other key findings include:
- 39.2% of plans were fully funded as of April 1, up from 35.2% as of Jan. 1, 2017.
Pension assets increased during the quarter by 3.2%; in the fourth quarter of 2016, asset returns - were 7.2%.
Among risk-seeking asset classes, emerging market equities performed the best in Q1, returning - 8%, while U.S. equities (+5.5%), international (MSCI EAFE) equities (+6.7%) and global (MSCI
- World) stocks (+5.8%) also performed well.
Domestic equities marked the worst performance among tracked stock indices, returning 2.4% - through the quarter.
As yields declined marginally (Canada 10-year benchmark yield was down ~10 basis points), bond - returns were positive: FTSE Long Term Bonds returned 1.9%, while FTSE TMX Universe bonds
- finished the quarter up by 1.2%.
Alternative asset returns were marginally positive, with global real estate up 1.7% and infrastructure - up 5.7%.
As bond yields declined, annuity purchase rates fell slightly through the quarter; however, the - resulting increase in pension liabilities was more than offset by positive asset returns.