Defined benefit scheme funding has held steady in February, despite the more volatile economic backdrop.
Figures from Broadstone’s Siruis Index, which monitors how various pension scheme strategies are performing on their journeys to self-sufficiency, found a slight increase in the funding level of schemes that were 50 per cent funded. The funding level for this strategy rose from 103.7 per cent to 103.8 per cent in February with the surplus holding at £1m.
However the fully hedged scheme’s funding deteriorated slightly in February with the funding level slipping from 69.9 per cent to 69.7 per cent. However, the deficit also held steady at £8.1m.
Broadstone head of trustee services Chris Rice says: “Despite rising geo-political tensions and a sense of economic malaise stoking uncertainty among UK markets, the funding positions of defined benefit schemes encouragingly held their ground in February.
“While this will certainly be a relief to trustees and sponsors, they can only hope this continues throughout March in the face of any additional political or economic headwinds.
“In other good news, those schemes that have improved their funding position and protected it may now have a new endgame opportunity with the entry of another insurer into the bulk annuity market, following Brookfield Wealth’s recent announcement.”
