UK. One in five FTSE 100 pension funds at risk of failure in a recession
One in five FTSE 100 defined benefit pension schemes would be at risk of failure if Britain entered another economic downturn, research reveals.
In a “stressed” scenario – such as a recession – the combined pension deficits of the blue-chip index would jump by £100bn, equivalent to four years of pre-tax profits, according to a study by consultants Cardano and Lincoln Pensions. In such a scenario a fifth of FTSE 100 firms would face pension risks worth 30pc or more of their market value, making widespread scheme failure more likely.
The report found some sectors were struggling more than others, with consumer goods and services firms posing the greatest concern, while oil and gas firms were judged to be more on top of their pension commitments.
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