World's top 300 pension funds see assets pass $15 trillion: study

Mon Sep 7, 2015 2:10am EDT
 
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LONDON (Reuters) - The combined assets of the world's largest 300 pension funds grew more than 3 percent in 2014 to a new high of more than $15 trillion, driven by retirement saving in North America and Europe, a study showed on Monday.

Ageing populations in the developed world have spurred pensions saving, while governments have provided incentives to encourage citizens to save more to avoid poverty in old age.

North America had the highest five-year combined compound growth rate of around 8 percent, according to the study, compiled by specialist newsletter Pensions & Investments (P&I) and consultants Towers Watson.

Growth in Europe over the same timeframe was more than 7 percent, and in Asia Pacific was around 4 percent, said the study, based on sources such as the P&I 1000, a list of the top 1,000 U.S. pension funds, as well as figures from annual reports, websites, and direct communication with pension fund organizations.

"While liabilities have also ballooned, this still represents a significant increase in savings wealth," said Chris Ford, global head of investment at Towers Watson.

Yet the decline of defined benefit funds in so-called "final salary" schemes was also shown in the study, which found such funds accounted for 67 percent of total assets, down from 75 percent five years ago.

Defined contribution (DC) assets, where the size of the retirement pot is dependent on market moves, grew the most, by almost 5 percent, it added, followed by defined benefit at almost 4 percent.

As a result, the funds represent around 43 percent of global pension assets, the study said.

(Reporting by Simon Jessop and Carolyn Cohn; Editing by David Holmes)

 
Retirees play poker at a singles club in Sun City, Arizona, in this January 4, 2013 file photo. REUTERS/Lucy Nicholson