Company pension funds in Switzerland could face a 15% increase to their long-term pension liabilities due to the county’s discount rate turning negative for the first time, according to Willis Towers Watson.

In another strange manifestation of the negative yields phenomenon, the consultancy warned that pension funds might need to take the unusual step in order to comply with international company reporting under IFRS/US GAAP.

“The discount rate used in the calculations needed for this reporting would be negative for the vast majority of Swiss pension funds now,” WTW said on its website.

Discount rates used in accounting by pension funds are based on corporate bond yields for that country. Swiss corporate bond yields have fallen significantly from their already low levels at the end of December 2018, Willis Towers Watson said, by about 90bps.

“This means that for a typical Swiss pension fund the discount rate would be around -0.1% at 27 August 2019,” the firm said.

If bond yields remained at similar levels, then companies would need to prepare themselves for significantly higher pension fund liabilities at forthcoming company year-end reporting dates, the consultancy said.

“For a typical Swiss pension fund the [pension scheme] liability is likely to have increased by around 15% based on current conditions,” it said.

As much as $15trn (€13.6trn) worth of investment grade bonds are trading with a negative yield, according to Cambridge Associates .

Norges Bank Investment Management recently reported that it held roughly €60bn worth of negative-yielding bonds in the Government Pension Fund Global, Norway’s giant sovereign wealth fund.

Negative-yielding bonds have also exacerbated the precarious funding position of many Dutch pension funds in recent months.