The funding ratio of the 27 Swiss cantonal Pensionskassen rose on average from 98% at end of 2019 to 100% at the end of 2020, according to data published by the publication Schweizer Personalvorsorge. The funding ratio rose for 22 pension funds, while it fell slightly for five.
The funding ratio for the list’s nine partially funded pension funds stood at 83.2%.
According to the data, the pension fund for the Canton of Zug topped the ranking for the partially funded Pensionskassen segment with a funding ratio of 109.6%, followed by the pension fund for teachers of the Canton of Bern, Bernische Lehrerversicherungskasse, with 97.2% and the pension fund for the Canton of Bern, Bernische Pensionskasse, with 95.8%.
The two pension funds for the Canton of Bern aim to reach full funding by 2034. The funding ratio of the 16 fully funded Pensionskassen reached 109.1% at the end of last year.
At the top of the list of fully funded pension funds stood the Pensionskasse for the Canton Appenzell Ausserrhoden with 116.3%, ahead of the Cantons Nidwalden, Schaffhausen and Appenzell Innerrhoden.
The scheme for the city of Basel (PKBS), which runs seven pension plans partially funded and the remainder fully funded, has seen its overall funding ratio decrease from 105.2% in 2019 to 103.1% in 2020.
Among the other Pensionskassen with a mixed degree of funding levels, the pension fund for the canton of Valais reached a funding ratio of just under 102%.
The performance for the cantonal pension funds fell year-on-year by 7 percentage points at the end of 2020 to an average 4.2%.
The technical interest rate used to calculate the schemes’ liabilities remained almost flat at the beginning of 2021 (1.94%) compared with 2.02% at the beginning of 2020.
The conversion rate used to calculate pension benefits at the time of retirement remained unchanged for 10 cantonal Pensionskassen at the end of last year.
The Pensionskasse for the Cantons of Fribourg, Geneva and Vaud waived their conversion rates because they are run as defined benefit plans, the data stated.
The remaining 14 pension funds recorded a reduction of their conversion rate from -0.01% to 0.64%. Fifteen cantonal Pensionskassen plan a further reduction to their conversion rates.
The Pensionskasse for the Canton of Zürich (BVK) will cut its conversion rate to 4.67% from 2022, while APK, the pension fund of the Canton Aargau, will cut to 5% from 2024, and the Bernische Pensionskassen to 4.80% until 2024.