| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

Home 
 
 News
 Irish
 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 International
 Property
 Innovation
 
 Analysis/Comment
 
 Asia Economy

RSS FEED


How to use our RSS feed

 
Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.

Welcome

Finfacts is Ireland's leading business information site and you are in its business news section.

We provide access to live business television and business related videos from: Bloomberg TV; The Wall Street Journal; CNBC and the Financial Times. Click image:

Links

Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Irish Economy

Global Income Per Capita

Global Cost of Living

Irish Tax 2008

Climate Change Reports

Global News

Bloomberg News

CNN Money

Cnet Tech News

Newspapers

Irish Independent

Irish Times

Irish Examiner

New York Times

Financial Times

Technology News

 

Feedback

 

Content Management by interactivetools.com.

News : Irish Last Updated: Dec 4, 2009 - 5:48:03 AM


Irish pension funds 2009 return to November at 16.5%; 10-year return average at 0.5%; Pension deficits at public companies rise to €5.4bn
By Finfacts Team
Dec 3, 2009 - 5:14:37 AM

Email this article
 Printer friendly page

Having declined for the first time in eight months during October, Irish pension funds returned to positive territory during November, returning 1.3% on average and 16.5% year-to-date. The best performing managed fund in November was that of Eagle Star/Zurich Life, which returned 1.7%. Irish Life Investment Managers propped up the league table with a 0.9% return for the month. The 10-year average return is 0.5%. Meanwhile, on Tuesday, it was also reported that the pension deficits of Irish quoted companies have risen almost 15% to €5.4 billion €5.4 billion in 2009.

Returns are positive for the year to date, with the average fund having gained 16.5% over this period. In the eleven months to the end of November, returns ranged from 23.7% (Merrion Investment Managers) to 9.0% (AIB Investment Managers), representing a difference of 14.7% between the best and worst performing managers so far this year. Over the past twelve months the average fund delivered 12.9%, with returns ranging from 19.3% (Merrion Investment Managers) to 5.4% (AIB Investment Managers).

Fiona Daly of Rubicon Investment Consulting commented: "The average managed fund return has been a very disappointing -8.6% per annum over the past three years. However, the five year returns to the end of November are positive on average, delivering a mean return of 0.7% per annum over this period. Irish group pension managed fund returns over the past ten years have been a disappointing 0.5% per annum on average, well below the Irish inflation rate of 2.9% per annum over the same time horizon. Indeed, none of the managed funds surveyed outperformed inflation over this period, while four of the ten funds failed to deliver positive returns over 10 years."

Pension deficits

Figures released on Tueday by Attain Consulting show that the combined pension deficits of Irish quoted companies has risen almost 15% to €5.4 billion from €4.7 billion at the start of the year. This is despite a recovery in asset values during the year to the end October.

Attain estimates that the assets in defined benefit pension schemes of Irish quoted companies rose by €2 billion, from €12 billion at the start of the year to €14 billion by the end of October. However, the liabilities measured on the basis used to account for pensions in company financial statements, rose from €16.7 billion to €19.4 billion over the same period. This meant that the combined deficit rose from €4.7 billion to an estimated €5.4 billion.

“At first sight the results might seem surprising as the rise in stock markets has relieved some of the pressure on pension schemes and has led to a partial improvement in the position of Irish pension schemes,” commented Maurice Whyms, director of Attain Consulting and a senior pensions actuary.

He said that the overall deterioration has come about however because in marked contrast to Irish schemes, the position of UK pension schemes has deteriorated sharply since the beginning of the year impacting on the balance sheets of those companies with UK subsidiaries. Increases in expected UK inflation have combined with significant reductions in UK corporate bond yields, a key driver of liability values, to drive up UK pension scheme deficits. “With close to a quarter of pension liabilities on Irish company balance sheets relating to UK subsidiaries, the deterioration in the UK position was bound to have some spill over effect,” said Whyms.

In its report entitled ‘Accounting for Pensions in Ireland,’ Attain estimates that the combined pension deficit reached a high of €6.0 billion in February and a low of €3.6 billion in May. To put the pension deficit in perspective, Whyms pointed out that the combined deficit of €5.4 billion amounts to 15% of the total market capitalisation of the companies involved.

“One of the factors driving the volatility of pension deficits is the relatively low level of investment in bonds. With just over a third of pension assets invested in bonds there is a risk that assets and liabilities move in opposite directions. While this can be positive or negative, we are likely to see a movement towards greater risk management and de-risking of pension schemes in the future,” he said.

Related Articles
403 Forbidden

Forbidden

Execute access is denied.


© Copyright 2009 by Finfacts.com

Top of Page

Irish
Latest Headlines
Ryanair reports profit in its financial first quarter soared 152%
UK firm opens van dealership in Dublin
Ryanair reports 8% fall in full-year profit; US services to commence in 2019
Global Financial Centres Index: New York overtakes London; Dublin slips to 66 of 83 cities
Bank of Ireland reports “significant” improvement in 2013 results
Sale process of IBRC UK projects Rock and Salt completed
CRH says 2014 will be year of profit growth after reporting 2013 loss
Ryanair reports third-quarter loss
Irish Water says it saved €100m in setup costs
RSA Insurance fires two Irish executives for large loss/ accounting irregularities
Bank of Ireland will have to raise provisions by €1.4bn; AIB says it's "well capitalised"
CRH reports slightly improved third quarter
Central Bank says ownership of Newbridge Credit Union transferred to permanent tsb
Ryanair reports H1 profits rose by 1% to €602m
Dublin Web Summit: Irish Stock Exchange and NASDAQ OMX announce dual listing plan
Irish pension managed funds returned to growth during September
Dan O’Brien resigns as economics editor of The Irish Times
Central Bank says no action required on Anglo tapes revelations
Ryanair flew 9m passengers and Aer Lingus carried 1.1m in August
UK Competition Commission says Ryanair must cut Aer Lingus stake to 5%
CRH reports H1 2013 revenue dip and loss
Vodafone refunded UK after discovery of Irish tax haven deal
RBS reports half year profit; Ulster Bank posts reduced loss
Bank of Ireland cuts pretax losses in HI 2013 to €504m
Irish State-owned Allied Irish Banks reports losses of €758m in H1 2013
Service Announcement
Irish managed pension funds declined in June
VHI reports 2012 surplus of €54.3m; Health insurance made loss
Ex- Elan director says management / board "not competent to run a business"
Aer Lingus to put €140m in employees pensions fund; Ryanair apoplectic
Wednesday Newspaper Review - Irish Business News and International Stories - - May 22, 2013
Tuesday Newspaper Review - Irish Business News and International Stories - - May 21, 2013
Ryanair, Europe’s biggest low cost carrier, announced Monday record annual profits of €569m - - up 13%
Monday Newspaper Review - Irish Business News and International Stories - - May 20, 2013
Friday Newspaper Review - - Irish Business News - - May 17, 2013
Thursday Newspaper Review - Irish Business News and International Stories - - May 16, 2013
Wednesday Newspaper Review - Irish Business News and International Stories - - May 15, 2013
Tuesday Newspaper Review - Irish Business News and International Stories - - May 14, 2013
Monday Newspaper Review - Irish Business News and International Stories - - May 13, 2013
Friday Newspaper Review - - Irish Business News - - May 10, 2013