ING to boost DB schemes by €814m
GLOBAL - ING Group, the Netherlands-headquartered life and pension provider, is boosting its own pension fund with an extra contribution worth €814m this year in a bid to help clear the company’s pension deficit.
Details of the firm’s 2008 annual report reveals it started the year with an opening balance on its pensions of €14.5bn but they had reduced to €14.27bn by the end of 2008.
According to the report, it had obligations of €14.271bn against the fair value of plan assets at €13.366bn - a difference at the end of all losses and contributions of €905m.
ING had already contributed approximately €1.366bn to its DB arrangements in 2008 - €550m more than in 2007 - however the liabilities now outweigh the assets as the funds saw a loss of €1.76bn last year, compared with a return of €80m in 2007.
The fund had also suffered an actuarial loss of €2.647bn last year through a slight adjustment to the basic actuarial assumptions taken on 31 December 2008, in which the weighted discount rates were set at 5.7% compared with 5.6% in 2007.
Officials have announced it will inject an extra €800m into its DB schemes within the first quarter above the €1bn contribution it had intended to make anyway this year.
ING reported in January it had pension assets of €10bn in its Dutch pension fund and a cover ratio of 107%, so the firm was required to submit a recovery plan to pull back the scheme to a 125% cover ratio within five years. (See earlier IPE story: ING grants indexation despite low cover ratio)
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