UK – UK life assurance and pension funds have seen a significant decrease in the percentage of their assets held in equities, according to CSFB.

CSFB estimates that the current share of equities in life assurance and pension funds sits at around 51% from a high of around 80% in 1994. This is still historically high, however, says CSFB – in 1945 this figure was 9%.

Equity weightings in the UK life assurance and pension fund industry are also high by international standards. In the US, equity weightings were 31% of financial assets, and in Europe this is likely to be lower still, says the research note.

Further selling of stock by UK life assurance and pension funds could be on the cards, says the report, and a “vicious selling spiral” is feared due to the issue of life assurance and pension fund solvency.

“We thought that LAPF’s [life assurance and pension_funds’] disengagement from equities was, perhaps, approaching an end, but we were clearly premature, “ says the research note.

CSFB also estimates a pension fund deficit of 60 billion pounds for companies in the FTSE 100. The aggregate plan was 66% invested in equities at the most recent year-end, according to CSFB’s research.

Last week, Morgan Stanley put deficits of defined benefit schemes for UK FTSE 100 companies at a massive 65 billion pounds as at the end of 2002.