The funded status of the 100 largest pension plan sponsors among U.S. publicly traded companies fell for the second straight year in 2012, despite strong investment returns and large employer contributions, according to analysis by Towers Watson.
Canyon Lake, Calif., has told the California Public Employees’ Retirement System that it wants to end its relationship with the pension fund.
The California Public Employees’ Retirement System pension and health benefits committee has approved new actuarial policies that are aimed at returning the system to fully funded status within 30 years.
On Jan. 1, 2013, amendments to Ontario’s Pension Benefits Act (PBA) took effect, allowing employers to use a letter of credit (LOC) to cover up to 15% of solvency liabilities in a pension plan. For employers in the province, the welcome change may help alleviate some of the funding challenges faced by DB plan sponsors.
The Ontario Teachers’ Pension Plan posted a solid 13% rate of return for the year ended Dec. 31, 2012, beating its consolidated benchmark by 2%.
Canadian pension plans have improved their solvency position in Q1 due to a strong performance in equities and a slight increase in long-term interest rates. The Mercer Pension Health Index was at 87% on March 31, up from 82% at the beginning of this year.
Although fewer companies are offering DB pension plans, U.K. employers paid record amounts to these plans last year, according to an analysis by Towers Watson on recent Office for National Statistics data.
Bailouts are complicated things when it comes to sovereign nations, as the continuing woes of Greece, Ireland, Spain and Portugal illustrate. For all the infusion of Eurofunds, austerity has ultimately ended in a dead parrot scenario (for those readers who recall the Monty Python sketch): economies that wouldn’t go “voom if you put four million volts through it!”
U.K. pension plans are showing tracking upward, according to Mercer’s Pensions Risk Survey data.
A whole new regulatory environment is taking shape for banks and near-bank financial institutions. From an investor’s perspective, the new requirements—regardless of the form that they ultimately assume—will undoubtedly influence the stock and bond markets, the over-the-counter derivatives markets and financial transactions in general.