August 2022
04Aug

U.S. corporate pension plan funding holds steady in July above 93% – 3 reports

U.S. corporate pension plan funding ratios remained relatively stable in July after months of poor investment returns had negatively affected the health of the plans, according to three new reports. Legal & General Investment Management America in its report estimated the average funding ratio of the typical U.S. corporate pension plan rose to 95% as of July 31 from 94% a month earlier. LGIMA in its latest Pension Solutions Monitor cited positive equity returns during the month, noting the S&P 500...

August 4, 2022
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July 2022
22Jul

US. Pension unfunded liabilities rising with market volatility

The markets giveth and the markets taketh away. Unfunded liabilities for state pension funds are expected to climb from $783 billion in 2021 to $1.3 trillion in 2022. The funded ratio of state pensions would fall from 85% last year to 75% in 2022. That’s according to the Reason Foundation, which states that after the market expansion of 2021 helped pensions; the rather lackluster performance of markets this year could see an average rate of return for state pensions at...

July 22, 2022
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07Jul

U.S. corporate pension plan funding continues to fall – reports

U.S. corporate defined benefit plan funding ratios continue to drop, primarily due to poor equity returns well offsetting declines in liability values, new reports show. A quarterly report from MetLife Investment Management shows the estimated average funding ratio of companies in Russell 3000 that sponsor defined benefit plans was 98.5% as of June 30, down from 102.5% as of March 31 Stephen Mullin, head of long duration and LDI strategies at MetLife, said in the report that each of the asset...

July 7, 2022
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04Jul

UK. DB pension surplus reached record high in June

The aggregate defined benefit (DB) pension scheme surplus in the UK increased by £60bn to £250bn in June, according to the PwC Pension Trustee Funding Index, marking the highest surplus recorded since the launch of the index in 2015. The index showed that whilst asset values fell over the month amid market volatility, this was more than offset by a larger fall in liabilities, as long-term bond yields continued to rise. Liabilities fell by £110bn to £1,340bn, while asset values declined...

July 4, 2022
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01Jul

US. Milliman: Public pension plans’ funding dips slightly in May

The estimated funding ratio of the 100 largest public defined benefit plans in the U.S. inched down to 78.4% at the end of May from 78.6% at the end of April, according to the latest Milliman 100 Public Pension Funding index released Wednesday. The "relatively stagnant market" of May provided a "reprieve" for these plans after the volatility experienced between February and April this year, Milliman said in a news release. The funding ratio was as high as 85.5% at...

July 1, 2022
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June 2022
08Jun

US. Corporate Pension Health Continues to Worsen in May

U.S. corporate pension plans ended May with a drop in their aggregate funded status — a simple measure of their financial health. The funded ratio for U.S. corporate pension plans decreased by 0.9 percentage points from April 30 to May 31, according to Wilshire’s May 2022 U.S. corporate pension plans funding report. Specifically, the aggregate funded ratio of the combined assets and liabilities of corporate pension plans sponsored by S&P 500 companies dropped from 98 percent at the end of...

June 8, 2022
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May 2022
12May

US. State pension funding soars to 83.3% in fiscal year 2021 – Wilshire

U.S. state pension plans' estimated aggregate funding ratio at the end of fiscal year 2021 jumped to 83.3% from 70% in the previous year, a report from Wilshire Advisors shows. Based on more than 100 state plans' most recent annual reports, most of which provide data as of June 30, the aggregate funding ratio is based on $3.957 trillion in aggregate assets and $4.752 trillion in aggregate pension liabilities, according to Wilshire's 2022 Report on State Retirement Systems. Asset levels rose...

May 12, 2022
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11May

Large corporate defined benefit plans in Canada are fully funded

Corporate defined benefit plans of public companies in Canada surged to 100% funding with higher discount rates. Asset allocations were little changed. Liability-driven investing continued to be at the forefront with about 50% of assets invested in fixed income. Alternative investments did increase to 7.7%, which was the highest allocation since data have been tracked. The median funded status increased to 100.3% up from 91.5% in 2020. This was the first time the median funding level increased to more than 100%...

May 11, 2022
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05May

U.S. corporate pension plan funding rises in April

U.S. corporate defined benefit plan funding ratios rose in April despite poor market returns, primarily due to rising discount rates, which lowered liability values, three reports show. In Wilshire Advisors' monthly report, the aggregate funding ratio for U.S. corporate pension plans increased by 30 basis points in April, to 97.4% as of April 30 from 97.1% as of March 31. While assets fell 7.7 percentage points due to a troubled equities market in February, liability values offset those losses by dropping...

May 5, 2022
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April 2022
29Apr

US. Companies Look to Diversify Their Pension Investments as Funding Levels Soar

Companies are looking for alternative investment options for their pension plan funds—for example, high-quality private credit—as they look to diversify their holdings amid high funding levels. Businesses in recent years have invested a greater proportion of their plans in fixed-income securities, which are considered safer bets than assets such as equities, commodities, private equity and real estate. S&P 1500 companies invested 51% of their plan funds in fixed income in 2021, up from 50% a year earlier and 42% a...

April 29, 2022
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