German corporate pension liabilities swell by a fifth in 2019

first_imgPension scheme funding levels for companies covered by the report – those included in the DAX and MDAX stock market indices – fell by around a fifth since the beginning of 2019, according to WTW’s modelling.For DAX company pension plans, funding levels fell to 62.3% at the end of September from 67% at the end of December 2018 while funding of plans at the slightly smaller MDAX firms dipped to 58.3% from 63.1%, the consultancy’s figures showed.However, this decline was much smaller than could have been expected given the significant increase in pension liabilities in the nine-month period, WTW said.This showed the companies were working intensively on their investment strategies specifically for their pensions assets, it said.According to the firm’s own calculation of the average discount rate for DAX companies, this rate sank to just 0.94% at the end of September, from 1.91% at the of December 2018.WTW’s figures showed the decline of the discount rate seen in the first nine months of this year was the biggest in percentage point terms since at least 2014, and comes in a period when 10 and 30-year bonds have turned negative.Examining the outlook for the background conditions that determine interest rates, the consultancy said in its report: “All in all, low eurozone interest rates are expected to persist for several years yet.” The pension liabilities of Germany’s largest companies have expanded by almost a fifth since the beginning of this year, because of further pressure on discount rates, consultancy Willis Towers Watson reported.But despite the development, funding ratios have remained relatively stable because corporates have made investment returns on their pensions assets of around 10%, the firm said in its report on German pensions finance for the third quarter of 2019.Heinke Conrads, leader of the firm’s German and Austrian retirement business, said: “The companies have had a strong headwind this year for their pension schemes from the development of interest rates, but also a strong tailwind through the positive development on capital markets.“Overall, it is clear that they have chosen their capital investment strategies well and were able to manage their pension schemes well,” she said.last_img read more

EPL: Leicester beat Sheffield, boost top-four hopes

first_imgRelatedPosts Ighalo: My best moment as ‘Red Devil’ EPL: Foxes attack Burnley EPL: Crystal Palace stun sloppy Man U Leicester City boosted their hopes of finishing in the Premier League top four as goals by Ayoze Perez and substitute Demarai Gray secured a 2-0 home win over Sheffield United.The result left Leicester fourth on 62 points from 36 games, three ahead of fifth-placed Manchester United who were visiting Crystal Palace later and one behind Chelsea in third. Sheffield United stayed eighth on 54 points, two behind sixth-placed Wolverhampton Wanderers who occupy a Europa League qualifying spot.Having won only one of their last six league games, Leicester needed a victory to get back on track in their bid to secure a berth in next season’s Champions League and they delivered with a dominant performance.Perez fired them ahead in the 29th minute with a crisp low shot from 14 metres after a fine cut-back by 19-year-old debutant Luke Thomas and Gray sealed the contest in the 79th with a clinical finish.The Foxes missed a string of chances to win by a bigger margin as visiting goalkeeper Dean Henderson made several reflex saves while top scorer Jamie Vardy hit the outside of the post shortly after halftime.Tags: Ayoze PerezCrystal PalaceLeicester CityManchester UnitedSheffield Untiedlast_img read more