Dutch pension sector’s funding ratio improves
In the first quarter of 2024, Dutch pension funds saw their funding ratios improve relative to the previous quarter, as the increase in their liabilities was lower than the growth in their investments. Total investments increased by €35 billion to €1,599 billion, while aggregate liabilities increased by €5 billion to €1,370 billion. The funding ratio reflects a pension fund’s current financial position, expressing the ratio between investments and liabilities.
The average funding ratio stands at 116.7%
The Dutch pension sector’s average funding ratio came to 116.7%. This represents a 2.1 percentage point increase from the previous quarter (see Figure 1). It is just above the figure for a year ago, which was 116.4%. This change is partly explained by improved investment yields, while interest rates remained stable.
The policy funding ratio stands at 118.2%
This represents a 0.2 percentage point decrease from the previous quarter. The policy funding ratio is the average of the funding ratios for the past twelve months. It fell because the average funding ratio in the first quarter of 2024 was lower than that in the corresponding quarter of 2023.
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