Global pension accounting snapshot – 30 September 2025
Overview of the key issues for those involved in global defined benefit (DB) pension plan accounting.
Key trends over Q3 2025
- Movements in corporate bond yields varied over the quarter to 30 September 2025 in the major economies. Since 30 June 2025, corporate bond yields in the Eurozone remained broadly unchanged however, there has been a slight decrease in corporate bond yields in the US and a slight increase in corporate bond yields in the UK.
- Global equity markets experienced significant positive returns over the quarter in the major economies, continuing the recovery that began after the sharp sell-off in April triggered by the US trade policies.
Discount rate assumptions and key local issues
The table below shows IAS19 discount rate assumption ranges at 30 September 2025 that we typically expect in major DB pension markets globally, as well as some of the key pension accounting issues in those countries.
|
Country |
Indicative IAS19 discount rate range |
Key issues in local market |
||
|
Short |
Medium |
Long |
||
|
UK |
5.1% – 5.6% |
5.6% – 6.2% |
6.0% – 6.4% |
The Virgin Media legal case may require further investigation and potential for additional disclosures. New CMI 2024 mortality projection model was released in June 2025 revealing an increase in life expectancies compared to CMI 2023. Corporates that adopt CMI 2024 will see increase in their liabilities. |
|
Eurozone |
2.3% – 3.8% |
3.4% – 4.0% |
3.8% – 4.2% |
Netherlands: |
|
USA |
5.2% – 5.3% |
5.3% – 5.4% |
5.4% – 5.5% |
Pension discount rates decreased in Q3 2025, and the Fed implemented a 25bps rate cut in September. Equity markets posted solid gains, supporting pension plan health. Pension risk transfer activity remained lower than last year but is expected to continue as sponsors monitor market developments. |
|
Canada |
4.0% – 4.4% |
4.4% – 4.8% |
4.8% – 5.0% |
No notable key issues currently in Canada. |
|
China |
1.4% – 1.8% |
1.9% – 2.1% |
2.2% – 2.4% |
Increases to statutory retirement age are currently being phased in from 2025 to 2040. Companies will see an increase in plan duration which may push up the discount rate accordingly once they have recognised the change. |
|
India |
5.5% – 6.7% |
6.7% – 7.0% |
7.1% – 7.6% |
No notable key issues currently in India. |
|
Indonesia |
5.5% – 6.5% |
6.8% – 7.0% |
7.1% |
Lower yields at shorter durations in light of recent cuts in Bank Indonesia benchmark rates. |
|
Norway |
4.2% – 4.4% |
4.2% – 4.4% |
3.9% to 4.2% |
No notable key issues currently in Norway. |
If you would like to discuss the above in further detail or would like insights for any other countries, please get in touch.
Movement in corporate bond yields
The chart below shows the change in the yields on AA-rated Sterling, US Dollar and Euro denominated corporate bonds over the quarter to 30 September 2025.
Since 30 June 2025, corporate bond yields in the Eurozone remained broadly unchanged however, there has been a c. 0.2% decrease in corporate bond yields in the US and a c. 0.2% increase in corporate bond yields in the UK. Multinationals are likely to see an increase in DB liability values in the US but a decrease in DB liability values in the UK compared to the position at 30 June 2025.
Growth asset performance
The chart below shows the performance of equity markets in the UK, US, Europe and Japan over the quarter to 30 September 2025.
Global equity markets experienced significant positive returns over the quarter, continuing the recovery that began after the sharp sell-off in April triggered by the US trade policies. The positive returns have also been attributed to central banks in the UK, US and Europe cutting interest rates over the quarter. There was a drop in performance in European markets in July which was attributed to tariff threats from the US on EU goods however, the European markets have since bounced back to end the quarter with returns of c. 5%. By the end of September, equity markets across the globe displayed positive returns of c. 7% in the UK, c. 10% in the USA and Japan.
Corporates with funded DB plans with growth-oriented investment strategies are likely to have seen an increase in their asset values as at 30 September 2025 compared to the position at 30 June 2025.
Contacts
Elliot Colman
Global Benefits Consultant
VIEW PROFILE
Email:
elliot.colman@mbwl-int.com
Tel: +44 (0) 20 3949 5711
Elliot Colman
Global Benefits Consultant
Elliot is a Global Benefits Consultant for MBWL and is based in London. He joins MBWL from PwC where he started his career over 7 years’ ago. He has experience working as both a corporate pensions actuary before moving into a M&A team specialising in global defined benefit plans.
He brings expertise in advising both large multinational companies and private equity firms on global defined benefit plans, equity plans, and other employee related issues over the course of a deals cycle, including buy-side and vendor due diligence and bespoke strategic advice for sale.
Elliot graduated from the University of Nottingham with a first-class degree in BSc (Hons) Financial Mathematics and is a Fellow of the Institute of Actuaries in the UK.
Isabel Coles
Head of International Consulting, MBWL International
VIEW PROFILE
Email:
isabel.coles@mbwl-int.com
Tel: +44 20 3949 5710
Isabel Coles
Head of International Consulting, MBWL International
A multilingual expert in employee benefits for multinational corporates.
Isabel heads up MBWL International, advising multinational organisations on their employee benefits arrangements around the world, with a focus on corporate sales and purchases, accounting disclosures and the financing, risk management and design of benefit plans.
Her vast experience includes leading global accounting consolidations under international, UK and US accounting standards for multinational companies headquartered in the UK and overseas – with consolidations ranging in size from two to over 50 defined benefit plans.
She has advised both corporate and private equity buyers on the employee benefit considerations (including pension liabilities) associated with corporate sales and purchases in Europe and worldwide, from due diligence through to closing and subsequent integration work. Isabel has also undertaken many benefit audits and benchmarking exercises, including a 25-country audit for a company in the technology sector.
Other areas of Isabel’s expertise include reviewing and establishing international pension plans, advice on individual expatriate employee benefit packages and supporting multinationals in agreeing and implementing global governance approaches and policies for managing their employer benefit plans.
Isabel chairs the International Committee of the Association of Consulting Actuaries and is fluent in German and French.
Contacts
Elliot Colman
Global Benefits Consultant
VIEW PROFILE
Email:
elliot.colman@mbwl-int.com
Tel: +44 (0) 20 3949 5711
Elliot Colman
Global Benefits Consultant
Elliot is a Global Benefits Consultant for MBWL and is based in London. He joins MBWL from PwC where he started his career over 7 years’ ago. He has experience working as both a corporate pensions actuary before moving into a M&A team specialising in global defined benefit plans.
He brings expertise in advising both large multinational companies and private equity firms on global defined benefit plans, equity plans, and other employee related issues over the course of a deals cycle, including buy-side and vendor due diligence and bespoke strategic advice for sale.
Elliot graduated from the University of Nottingham with a first-class degree in BSc (Hons) Financial Mathematics and is a Fellow of the Institute of Actuaries in the UK.
Isabel Coles
Head of International Consulting, MBWL International
VIEW PROFILE
Email:
isabel.coles@mbwl-int.com
Tel: +44 20 3949 5710
Isabel Coles
Head of International Consulting, MBWL International
A multilingual expert in employee benefits for multinational corporates.
Isabel heads up MBWL International, advising multinational organisations on their employee benefits arrangements around the world, with a focus on corporate sales and purchases, accounting disclosures and the financing, risk management and design of benefit plans.
Her vast experience includes leading global accounting consolidations under international, UK and US accounting standards for multinational companies headquartered in the UK and overseas – with consolidations ranging in size from two to over 50 defined benefit plans.
She has advised both corporate and private equity buyers on the employee benefit considerations (including pension liabilities) associated with corporate sales and purchases in Europe and worldwide, from due diligence through to closing and subsequent integration work. Isabel has also undertaken many benefit audits and benchmarking exercises, including a 25-country audit for a company in the technology sector.
Other areas of Isabel’s expertise include reviewing and establishing international pension plans, advice on individual expatriate employee benefit packages and supporting multinationals in agreeing and implementing global governance approaches and policies for managing their employer benefit plans.
Isabel chairs the International Committee of the Association of Consulting Actuaries and is fluent in German and French.