ABP and PME funding ratios pass 132% before pension switch
The pension funds for civil servants and teachers (ABP) and for the metal and tech industry (PME) both ended the third quarter with funding ratios above 132%. They move to the new pension system on 1 January, just weeks away.
ABP's funding ratio (dekkingsgraad) rose from 126.9% to 132.2% in the third quarter. At PME it rose from 127.7% to 132.8%. The ratio compares a fund's assets with the value of all pensions already built up.
Both funds move to the new pension scheme on 1 January, which ends the funding ratio as a measure. ABP hopes for a ratio of at least 110% at the transition. The more money the funds hold then, the more is divided among members' individual pension pots.
Both funds' funding ratios rose in the third quarter
%
Both funds' funding ratios rose in the third quarter (%). Highest: PME, 127.7; lowest: ABP, 126.9; 2 items. Source: ABP and PME.
View data
| Item | Start of Q3 | End of Q3 |
|---|---|---|
| ABP | 126.9 | 132.2 |
| PME | 127.7 | 132.8 |
ABP chair Harmen van Wijnen called the quarter turbulent. "The war in the Middle East flared up and interest rates rose sharply because of ever-growing government debts in, among others, the United States and France," he said.
Higher rates cut investment returns, so ABP's assets fell to €542bn. Its pension liabilities fell proportionally more, to €411bn, because the fund had to set aside less.
PME chair Alae Laghrich said pensioners can on average expect their pension to rise by 12.6% in 2027, if the economy and interest rates do not swing greatly. "That is a good prospect, but we must also be clear: the final amount is only fixed early next year."
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PME (Pensioenfonds Metaal en Techniek)
PME is a sector pension fund: the Dutch pension fund for current and former employees in the metal and technology industry. It manages the supplementary workplace pensions built up by these workers, which are paid on top of the state pension (AOW). Like other Dutch pension funds, it reports a funding ratio (dekkingsgraad), which compares its assets with the value of all pensions already accrued.