Netherlands’ ABP funding ratio rises to 104.5% in Q2

The Netherlands’ largest pension fund, ABP, has reported that its funding ratio has increased by approximately 4 per cent in the second quarter of 2021.

Publishing its quarterly update, ABP said its funding ratio now stands at 104.5 per cent, up from just above 100 per cent at the end of March 2021. It attributed the rise in the funding ratio to the performance of its investments, which is different to the rise in interest rates that positively affected the funding ratio in the first quarter.

ABP achieved a return of 4.6 per cent on its investments in the second quarter, bringing its available capital to €523bn.

It said the chance of a reduction to pensions is small because of the current funding ratio being well away from the critical limit of 90 per cent. However, the fund said that this year pensions will remain the same and is also expected to be the case in 2022.

“ABP does not expect to be able to increase pensions next year in line with the price increase (also known as indexation), because the policy funding ratio is still too low,” it said.

The policy funding ratio, which is the average funding ratio over the past 12 months, is currently at 94.6 per cent. A partial increase in pensions requires a policy funding ratio above 110%. For a full increase, the limit is 123%.

In addition, ABP revealed that in the second quarter, it welcomed 16,769 new participants. At the same time, 10,557 people retired from April to June.

    Share Story:

Recent Stories

Podcast: The benefits of private equity in pension fund portfolios
The outbreak of the Covid-19 pandemic, in which stock markets have seen increased volatility, combined with global low interest rates has led to alternative asset classes rising in popularity. Private equity is one of the top runners in this category, and for good reason.

In this podcast, Munich Private Equity Partners Managing Director, Christopher Bär, chats to European Pensions Editor, Natalie Tuck, about the benefits private equity investments can bring to pension fund portfolios and the best approach to take.

Podcast - The power of three: Using Common Contractual Funds to improve tax outcomes for investors
Large asset owners are still investing in equities in a way where they are taxed on their income. The implication is that they get a poorer return. They need to, and can, improve this, but how?

In this podcast, AMX Head of Client and Manager Development, Aaron Overy, and AMX Product Tax Specialist, Kevin Duggan, discuss with European Pensions Editor, Natalie Tuck, about three options to help ensure good withholding tax outcomes for institutional investors.
Mitigating risk
BNP Paribas Asset Management’s head of pension solutions, Julien Halfon, discusses equity hedging with Laura Blows

Europe’s pensions challenges
Francesca Fabrizi meets Matti Leppälä, Secretary General and CEO of PensionsEurope, to discuss the key aims and objectives of the association today.