Dutch logistics firm TPG says lower interest rates have caused a e560m increase in its pension liabilities.
“The reason for the increase in the accumulated benefit obligation compared to plan assets is mainly caused by the fact that the interest rate decreased from 5.5% in 2003 to 4.75% in 2004 (impact approximately e560m),” TPG stated in its 2004 annual report.
TPG added that its major plan, Stichting Pensioenfonds TPG, returned 8.8% on assets in 2004, compared with 9.1% in 2003. The scheme is around 93% covered.
Pension assets rose to e3.69bn from e3.28bn at the end of 2003 – while the accumulated benefit obligation was up to e4.64bn from e3.39bn.
It said it made e200m in cash contributions to its various pension funds. “Of these payments, e91m was contributed as prescribed by the minimum funding requirements of the DNB.”