Pension plans are protecting themselves from market ups and downs by matching assets to liabilities
Longevity risks affect all plan sponsors, healthcare costs set to rise, market value of pension funds rises, Alberta proposes cuts to public sector pensions, This month in Numbers and Market Watch.
America’s 100 biggest public employee pension plans saw a record increase in the value of their assets during the second quarter of this year—but benefits and withdrawals rose, too, according to new figures from the U.S. Census Bureau.
Just as the outlook started to improve for DB plans, new guidance from the Canadian Institute of Actuaries could increase the solvency liabilities of indexed DB plans by up to 15%, according to Eckler's latest analysis.
Both Quebec and Newfoundland and Labrador face the largest pension risk because of the size of their unfunded pension liabilities relative to their revenues, according to a report from Moody’s.
Statistics Canada finds that the market value of Canadian employer-sponsored pension funds totaled $1.2 trillion at the end of the first quarter, up 3.9% from the fourth quarter of 2012.
The accounting deficits of DB pension plans in the United Kingdom increased over the month of August.
The funded status of typical U.S. corporate pension plans fell 0.1 percentage points to 88.1% in August according to the BNY Mellon Investment Strategy & Solutions Group.
Many employers would like to reduce the risk in their DB plan so that the level of pension risk meets the company’s overall risk management objectives. One of the reasons employers may be waiting to de-risk is because they intend to "lock in" future gains resulting from strong investment returns (which increase plan assets) or increasing bond yields (which decrease plan liabilities). However, it’s important to recognize that de-risking opportunities may emerge quickly and could be short-lived.
The funded status of state-level DB public pension plans reveals that public employee retirement promises are underfunded by US$4.1 trillion, according to a report.