Global pension assets in 11 major markets increased 17% in 2005 to $16.4 trillion, according to a Watson Wyatt Worldwide survey. Global pension liabilities grew about 9%. This was, however, an improvement from 1999-2002, when liabilities outgrew asset growth by about 30 percentage points, according to the survey. Overall, the ratio of liabilities to assets was 19 percentage points greater for 2005 from the ratio for 2000. Also, defined contribution assets now comprise about 25% of total global pension assets, growing on average by about one percentage point a year since 1995.
U.S. defined benefit and defined contribution plans had a combined $8.12 trillion in assets, up 7% from 2004; Japan had $3.24 trillion, up 22%; U.K. plans had $1.62 trillion, up 20%; Canada had $1.02 trillion, up 14%; and the Netherlands, $764 billion, up 20%. All asset and liability data were measured by local currencies.
"Local pension fund balance sheets strengthened a little in 2005," said Roger Urwin, global head of investment consulting at Watson Wyatt in the news release. "This was largely due to rising markets, although liabilities remained stubbornly high as bond yields continue to falter globally."