The aggregate funded ratio for Canadian pension plans in the S&P/TSX composite index declined to 105.5 per cent in the first quarter of 2025, compared to 107.5 per cent at the end of the previous quarter, according to a new report from Aon.

Pensions assets lost about 0.5 per cent over the period. In a press release, Nathan LaPierre, partner for wealth solutions in Canada at Aon, said the ongoing market dispute between the U.S. and Canada, escalating from the threat to then the imposition of tariffs, caused the markets to be impacted by volatility.

Read: Average Canadian DB pension plan returns 1.6% in Q4 2024: report

“Pension plans faced significant headwinds during the quarter but starting from strong funded positions at the beginning of the quarter.”

In a separate report, Mercer found the median solvency ratio of Canadian DB plans dropped to 122 per cent as at March 31, 2025, compared to 125 per cent at the end of 2024.

More than half (53 per cent) of the DB plans in Mercer’s database have a solvency ratio above 120 per cent, a decline from 55 per cent at the start of 2025. Plans with a solvency ratio between 110 per cent and 120 per cent increased to 22 per cent.

“The overall financial health of Canadian DB pension plans remains strong, despite a slight decline during the quarter,” said Jared Mickall, a Mercer principal and wealth practice leader in Winnipeg, in a press release. “Asset performance was mixed and liabilities increased. From a solvency perspective, DB pension plans for Canadian workers continue to be generally secure.”

Read: Average funded ratio of Canadian DB pension plans up 2% in Q4 2024: report