Dutch Pension Coverage Ratios Stagnant But At Least Insecurity Has Not Increased
19 June 2012 (PLANSPONSOREurope.com) - As turbulent markets take their toll on Dutch pension fund coverage ratios the situation in Greece has at least meant that insecurity has not increased, a spokesperson for Dutch pension delivery organisation APG has told PLANSPONSOR Europe.
Latest figures from the Dutch pensions regulator reveal the average funding ratio of Dutch pension funds at the end of May stood at 99%, unchanged from the end of March. The funding ratio between available assets and liabilities – remained stable due to positive returns on fixed-rate assets and the effect of using the average interest rate were offset by losses on the stock exchanges.
An APG spokesperson told PLANSPONSOR Europe that insecurity in the eurozone was leaving its mark on Dutch pension funds.
“As long as there is insecurity about the eurozone, the interest rate we use to discount liabilities will remain low and that means high liabilities and low coverage ratios.
“Our investment plan has been based and still is on a muddling through scenario and this is part of the muddling through scenario.
“The absence of bad news from Greece means the insecurity hasn’t increased. The Dutch Minister of Social Affairs is looking at different ways to use the coverage ratio such as an average over a year.”