The ratio of the market value of assets to the projected benefit obligation for a hypothetical benchmark plan changed little for global defined benefit pension plans in the third quarter of 2024, according to a new report by WTW.
It found this ratio increased among DB plans in Brazil (0.9 per cent), Canada (1.2 per cent) and the U.K. (0.6 per cent) and decreased among plans in Japan (negative 3.8 per cent), Switzerland (negative 2.9 per cent), the Eurozone (negative 0.4 per cent) and the U.S. (negative 1.5 per cent).
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Positive asset returns in most regions over the quarter were mostly offset by increased liability values as a result of lower discount rates in all regions, said the report, noting all countries except for Japan experienced positive asset returns.
Among Canadian DB plans, public equities and bonds showed positive returns. Overall, the benchmark portfolio increased 6.6 per cent, while the benchmark discount rate decreased by 30 basis points over the quarter, which, taken together with interest accumulation, increased the liability by 5.4 per cent over the quarter.
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