According to pension market research, final salary pension schemes have had a severe week of change, with further dives in global stock markets . The largest 200 defined benefit or final salary pension schemes saw a record £27 billion funding shortfall increase on Monday alone. Apparently, this is the largest single day loss ever.
Aon Consulting, pension market experts, made it clear that the volatile world financial markets were behind the change, with a slump in the FTSE particularly responsible. The head of corporate solutions at Aon, Marcus Hurd, reportedly commented: The past week has been the most volatile for final salary pension schemes since accounting standards were changed in June 2001. During the past five days, the deficit peaked at a massive £73bn, the highest level since February 2006. This was prompted by the large losses in the equity markets and the 0.25% drop in corporate bond yields. We are seeing swings of unprecedented proportions at the current time."
He reportedly continued: "With one half of companies about to formally report their position at 31 March, this is a real concern. Depending on where markets settle at midnight on Tuesday 31 March, this will determine how companies report their balance sheets and 2009 profitability."
Multi-billion pension deficit increases
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Multi-billion pension deficit increases
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