PMT and PME, the large industry-wide pension funds for Dutch metal workers, are assessing the possible effects of Brexit on their counterparties in the UK for cash transactions and derivatives transactions such as interest swaps.

They are also considering whether to start entering contracts with additional players elsewhere in the European Union.

On its website, the €63bn PMT said it was continuously monitoring developments in interest rates, currency movements and the strategic weightings within its investment portfolio. 

In the run-up to last week’s Brexit referendum, in which the UK voted to exit the EU, the scheme acknowledged it had decided against taking hedging measures, “as the available options would have come at too great an expense had the UK decided to remain”.

Both PMT and PME, the €42bn scheme for the electro-technical engineering sector, said they had fully hedged downward risk on the pound, and that they had covered 50% of the interest risk on their liabilities.

Meanwhile, SPF, the €3bn pension fund for physiotherapists, said it recently reduced its equity allocation in favour of “safe” government bonds, while the €21.5bn industry-wide scheme PGB said its funding had fallen by 3.5 percentage points in the immediate aftermath of the referendum.

It conceded it would be facing a pensions rights cut in 2017 if its financial position failed to improve before year-end.

The €7.6bn KLM pension fund for ground staff confirmed it also lost “a couple of percentage points” in funding following the referendum.

It noted on its website that the Brexit decision had increased instability and that it expected more financial-market volatility.

The Algemeen Pensioenfonds KLM, however, said it saw no reason to adjust its investment portfolio for the time being.

This view was echoed by Vliegend Personeel, its €7.9bn sister scheme for cockpit staff, which underlined its “long-term and defensive strategy”.

TPN, the €420m Dutch pension fund of energy company Total, pointed out that the initially large movements on the financial markets had not continued, but that political uncertainty remained.

It ruled out taking short-term measures but said it would “certainly assess” whether long-term adjustments were needed.