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💵 Survey: Canadian defined benefit pension plans saw increased funded levels in Q1

Wednesday, 24 April 2024 04:33.PM

Aon plc, a leading global professional services firm, announced today that the aggregate funded ratio for Canadian pension plans in the S&P/TSX Composite Indexincreased from 100.7 percent to 105.1 percent during the past 3 months, according to the Aon Pension Risk Tracker.

The Aon Pension Risk Tracker calculates the aggregate funded position on an accounting basis for companies in the S&P/TSX Composite Index with defined benefit plans. To access Aon's interactive tracker, which dates to 2013, click here. The tool allows plan sponsors to track their individual plan's funded status daily. Versions of the pension tracker are also available for the S&P 500 in the U.S. and for other indices in the UK.

Key findings for the quarter ending March 31, 2024 include:

• Pension assets gained 2.9 percent over the first quarter of 2024.
• The long-term Government of Canada bond yield increased 32 basis points (bps) relative to the previous quarter rate, and credit spreads narrowed by 9 bps. This combination resulted in an increase in the interest rates used to value pension liabilities from 4.42 percent to 4.65 percent.

"The financial health of pension plans in Canada continues to improve," said Nathan LaPierre, partner, Wealth Solutions, Aon. "As a result, we expect de-risking and risk transfer activities to continue apace."

SOURCE: Aon plc

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