Falling stock markets and interest rates have wiped £15bn off the value of UK company pension schemes so far this year, calling into question their investment strategies and reviving concerns about underfunding.
By the close of markets on Friday, there was an aggregate £5bn shortfall in the plans of the FTSE 350 largest companies, compared with a £10bn surplus at the end of December, according to data from PwC.
At one point the size of the hit to the schemes was £25bn. The gyrations highlight the fact that pension finances remain firmly tied to the fortunes of stock markets, in spite of companies’ efforts to diversify.
Markets can solve everything! FREEEDDOOOMMMM!!!!!!!!!!!!!!! (and more profits for corporate fatcats!)
It's insurance. It's a good thing.
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