The Pension Funds Monitor is a real-time indicator of the financial position in the 2nd pillar. It provides information about the average funding ratio and the average investment performance of Swiss pension funds. The aim of the Pension Funds Monitor, besides gaining insight on performance, is to provide an indicator that can act as a key criterion for assessing the financial situation of pension institutions.
The pension schemes surveyed achieved an asset-weighted return of 1.54% in the fourth quarter of 2019. For the whole year, the return before fees is a considerable 11.52%. All asset classes contributed positively to this result.
The reserves of Swiss pension funds increased significantly in 2019 due to price gains. Estimated at 118.7%, the funding ratios of private pension schemes were at an all-time high at the end of the year. The development of the funding ratios (estimates) is as follows:
|Pension schemes||Funding ratios 2018* in %||Funding ratios 30/09/2019 in %||Funding ratios 31/12/2019 in %|
|Private-law funds ||108.7||117.5||118.7|
|Public-law funds, |
|Public-law funds, partial capitalisation ||79.6 ||86.6||87.8|
*Results of the Swiss Pension Funds Study 2019.
The calculations for the Pension Funds Monitor are based on data from the Pension Funds Study of Swisscanto Pensions Ltd. published annually.
The funding ratios of the current year are estimated and aggregated for the individual pension plan. Changes on the liabilities side are determined using the historical target returns of the previous year. If no reliable target return can be calculated, the average of the historical target returns is used. The performance of individual asset-side balance sheet items is simulated by means of index performances without deduction of asset management costs and under the assumption that no rebalancing takes place.
The result of the aggregation is the performance of the total assets. Weighted averages are, in principle, used for the estimations at the aggregated level. The weighted and the unweighted averages are given for the performance estimate: the unweighted average is the simple mean of the performance estimates at the level of the individual pension scheme.
We recognise that a consideration of the average funding ratio alone provides only limited information. Each pension scheme must be considered based on its individual situation.
Further documents on the following topics can be found on the German and / or French versions of this page: