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Pension Funds

PPF: U.K. corporate pension funding improves again in October

The total deficit of all U.K. corporate pension funds covered by the Pension Protection Fund's 7800 index fell 5.2% in October to 149.8 billion ($197.3 billion).

The latest update by the PPF said deficits fell 45.7% over the 12 months ended Oct. 31.

The funding ratio of these pension funds improved to 91.2%, compared with 90.6% as of Sept. 30 and 84.1% as of Oct. 31, 2016.

Assets grew 1.2% in October and 5.7% in the year, to 1.543 trillion. The update said the increase over the month reflected the impact of higher equity prices. For the year, the FTSE All-Share index was up 9.3%.

Liabilities grew 0.6% in October, with conventional 15-year gilt yields falling 1 basis point, and index-linked five-to-15-year gilt yields falling 5 basis points in October. For the year, liabilities fell 2.5%. Fifteen-year gilt yields were up 10 basis points, while index-linked five-to-15-year gilt yields grew 20 basis points over the 12-month period.

The proportion of pension funds in deficit was 69.6% as of Oct. 31, compared with 70.4% as of Sept. 30 and 78.8% as of Oct. 31, 2016.