Dutch pension fund PME has revealed that its current funding ratio rose by 2.3 percentage points in July 2023.

The pension fund’s current funding ratio increased from 113.5 per cent to 115.8 per cent over the month.

Each month, the current funding ratio shows the ratio between the pension fund’s assets and liabilities.

PME’s current funding ratio has been rising since March, when it stood at 111.5 per cent, and is now 5.7 percentage points higher than its current funding ratio in January, when it was at 110.1 per cent.

Alongside the increase in the current funding ratio, PME’s policy funding ratio also rose in July.

PME’s policy funding ratio, which is the average of the previous 12 months’ current funding ratios, improved by 0.5 percentage points during the month, from 112.5 per cent to 113 per cent.

Dutch pension funds are obliged to have an additional in their funding ratio to cover financial setbacks.

This required funding ratio differs per pension fund and is determined by law, with PME having a sufficient buffer with a funding ratio of 120.3 per cent.

As the pension fund’s policy funding ratio is below 120.3 per cent, it has drawn up a recovery plan, which explains how it will get its funding ratio back to 120.3 per cent within 10 years.

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