UK defined benefit in worst funding position on record

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UK defined benefit schemes have hit a funding low after combined deficits increased nearly £100bn last month to hit £312bn, statistics show.

The Pension Protection Fund 7800 index, which tracks 6,432 DB schemes in the UK, shows the combined deficit was £312.1bn at the end of May 2012, up from £216.8bn at the end of April. The figure is the highest deficit since PPF records began in 2003. PPF figures show total assets were worth £1030.8bn but liabilities had increased to £1343bn, leaving a funding ratio of 76.8% for May, down from 82.6% last month. It leaves just 929 schemes in surplus compared to 5,503 in deficit. The reason for the rise in deficits is a 55bps fall in 15 year gilt yields, which has led to a 7.6% incr...

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