Global DB Pension Risk – USA and UK in focus
Will we look back upon 2022 as a period of fundamental change in the funding of defined benefit (DB) plans worldwide? After over a decade of historically low bond yields, the spectre of rising prices has triggered a rapid tightening in monetary policy across the developed economies.
The resulting increase in bond yields has significantly reduced the value of DB pension liabilities, providing a welcome boost to the funding levels of DB pension plans despite the challenging period for growth assets.
Very recently, we have seen some substantial movements in exchange rates, with UK sterling weakening materially against the dollar. This provides further impetus for multinational companies to consider de-risking opportunities in the UK, particularly US-based companies.
In this note we consider how the two largest private sector DB pension markets, the USA and the UK, have fared during this time of important change. We also explore the key issues and opportunities multinational companies should be considering in this transformed environment: from cash funding and balance sheet management to investment and derisking.
Contacts
John-Paul (JP) Augeri
Managing Director and Global EB Consulting Leader, Milliman
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Email:
johnpaul.augeri@milliman.com
Tel: +1 347 541 1146
John-Paul (JP) Augeri
Managing Director and Global EB Consulting Leader, Milliman
A global human capital and risk management leader with wide-ranging technical and management experience.
JP joined Milliman to lead the Global Employee Benefits Consulting Practice, in partnership with MBWL. He has over twenty years’ experience helping multinational clients to design, deliver and manage programs globally across pensions, benefits and M&A. He specialises in solving complex global issues and delivering value and innovation to multinationals and their employees.
His expertise includes: global pensions and benefits; M&A; funding, investment, and derisking strategies; change management; total rewards and employee experience; global client management and business development.
He has also served as a board chair and senior advisor, as is a frequent external speaker who has helped lead several client roundtables.
JP is a Fellow of the Institute of Actuaries in the UK, and he has lived and worked in the US, UK, Germany, and Austria.
Lewys Curteis
Principal, Barnett Waddingham
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Email:
Lewys.Curteis@Barnett-Waddingham.co.uk
Tel: +44 333 11 11 222
Lewys Curteis
Principal, Barnett Waddingham
Lewys joined Barnett Waddingham in 2012, having graduated from Durham University with a First Class degree in Natural Sciences (Mathematics and Physics). Lewys qualified as an actuary in July 2016, winning the Actuarial Risk Management prize for the performance in his CA1 exam.
Lewys advises companies on a wide range of defined benefit (DB) pension issues, including funding valuations, corporate accounting, transactions and liability management. He has completed projects for a variety of different companies (with schemes ranging from the low millions to the multi-billions), helping to reduce both risk and cost.
Lewys has also spent time in the USA as part of Barnett Waddingham’s joint venture with Milliman, building up a good understanding of US pensions issues.
Lewys became a Principal at Barnett Waddingham in 2022.
Contacts
John-Paul (JP) Augeri
Managing Director and Global EB Consulting Leader, Milliman
VIEW PROFILE
Email:
johnpaul.augeri@milliman.com
Tel: +1 347 541 1146
John-Paul (JP) Augeri
Managing Director and Global EB Consulting Leader, Milliman
A global human capital and risk management leader with wide-ranging technical and management experience.
JP joined Milliman to lead the Global Employee Benefits Consulting Practice, in partnership with MBWL. He has over twenty years’ experience helping multinational clients to design, deliver and manage programs globally across pensions, benefits and M&A. He specialises in solving complex global issues and delivering value and innovation to multinationals and their employees.
His expertise includes: global pensions and benefits; M&A; funding, investment, and derisking strategies; change management; total rewards and employee experience; global client management and business development.
He has also served as a board chair and senior advisor, as is a frequent external speaker who has helped lead several client roundtables.
JP is a Fellow of the Institute of Actuaries in the UK, and he has lived and worked in the US, UK, Germany, and Austria.
Lewys Curteis
Principal, Barnett Waddingham
VIEW PROFILE
Email:
Lewys.Curteis@Barnett-Waddingham.co.uk
Tel: +44 333 11 11 222
Lewys Curteis
Principal, Barnett Waddingham
Lewys joined Barnett Waddingham in 2012, having graduated from Durham University with a First Class degree in Natural Sciences (Mathematics and Physics). Lewys qualified as an actuary in July 2016, winning the Actuarial Risk Management prize for the performance in his CA1 exam.
Lewys advises companies on a wide range of defined benefit (DB) pension issues, including funding valuations, corporate accounting, transactions and liability management. He has completed projects for a variety of different companies (with schemes ranging from the low millions to the multi-billions), helping to reduce both risk and cost.
Lewys has also spent time in the USA as part of Barnett Waddingham’s joint venture with Milliman, building up a good understanding of US pensions issues.
Lewys became a Principal at Barnett Waddingham in 2022.